Correlation Between BioInvent International and Isofol Medical
Can any of the company-specific risk be diversified away by investing in both BioInvent International and Isofol Medical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BioInvent International and Isofol Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioInvent International AB and Isofol Medical AB, you can compare the effects of market volatilities on BioInvent International and Isofol Medical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in BioInvent International with a short position of Isofol Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioInvent International and Isofol Medical.
Diversification Opportunities for BioInvent International and Isofol Medical
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BioInvent and Isofol is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding BioInvent International AB and Isofol Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Isofol Medical AB and BioInvent International is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on BioInvent International AB are associated (or correlated) with Isofol Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Isofol Medical AB has no effect on the direction of BioInvent International i.e., BioInvent International and Isofol Medical go up and down completely randomly.
Pair Corralation between BioInvent International and Isofol Medical
Assuming the 90 days trading horizon BioInvent International AB is expected to under-perform the Isofol Medical. But the stock apears to be less risky and, when comparing its historical volatility, BioInvent International AB is 1.13 times less risky than Isofol Medical. The stock trades about -0.42 of its potential returns per unit of risk. The Isofol Medical AB is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 234.00 in Isofol Medical AB on October 22, 2024 and sell it today you would lose (9.00) from holding Isofol Medical AB or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BioInvent International AB vs. Isofol Medical AB
Performance |
| Timeline |
| BioInvent International |
| Isofol Medical AB |
BioInvent International and Isofol Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioInvent International and Isofol Medical
The main advantage of trading using opposite BioInvent International and Isofol Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioInvent International position performs unexpectedly, Isofol Medical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Isofol Medical will offset losses from the drop in Isofol Medical's long position.| BioInvent International vs. Hansa Biopharma AB | BioInvent International vs. Saniona AB | BioInvent International vs. Active Biotech AB | BioInvent International vs. Oncopeptides AB |
| Isofol Medical vs. XSpray Pharma AB | Isofol Medical vs. Oncopeptides AB | Isofol Medical vs. Hansa Biopharma AB | Isofol Medical vs. Alligator Bioscience AB |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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