Correlation Between BioInvent International and Nanologica
Can any of the company-specific risk be diversified away by investing in both BioInvent International and Nanologica 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 Nanologica 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 Nanologica AB, you can compare the effects of market volatilities on BioInvent International and Nanologica 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 Nanologica. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioInvent International and Nanologica.
Diversification Opportunities for BioInvent International and Nanologica
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BioInvent and Nanologica is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding BioInvent International AB and Nanologica AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanologica 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 Nanologica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanologica AB has no effect on the direction of BioInvent International i.e., BioInvent International and Nanologica go up and down completely randomly.
Pair Corralation between BioInvent International and Nanologica
Assuming the 90 days trading horizon BioInvent International AB is expected to generate 1.03 times more return on investment than Nanologica. However, BioInvent International is 1.03 times more volatile than Nanologica AB. It trades about 0.05 of its potential returns per unit of risk. Nanologica AB is currently generating about -0.47 per unit of risk. If you would invest 4,335 in BioInvent International AB on August 25, 2024 and sell it today you would earn a total of 120.00 from holding BioInvent International AB or generate 2.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BioInvent International AB vs. Nanologica AB
Performance |
| Timeline |
| BioInvent International |
| Nanologica AB |
BioInvent International and Nanologica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioInvent International and Nanologica
The main advantage of trading using opposite BioInvent International and Nanologica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioInvent International position performs unexpectedly, Nanologica 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 Nanologica will offset losses from the drop in Nanologica'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 |
| Nanologica vs. Senzime AB | Nanologica vs. C Rad AB | Nanologica vs. CellaVision AB | Nanologica vs. Episurf Medical 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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