Correlation Between BB Biotech and Banque Cantonale
Can any of the company-specific risk be diversified away by investing in both BB Biotech and Banque Cantonale 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 BB Biotech and Banque Cantonale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BB Biotech AG and Banque Cantonale du, you can compare the effects of market volatilities on BB Biotech and Banque Cantonale 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 BB Biotech with a short position of Banque Cantonale. Check out your portfolio center. Please also check ongoing floating volatility patterns of BB Biotech and Banque Cantonale.
Diversification Opportunities for BB Biotech and Banque Cantonale
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BION and Banque is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding BB Biotech AG and Banque Cantonale du in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banque Cantonale and BB Biotech 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 BB Biotech AG are associated (or correlated) with Banque Cantonale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banque Cantonale has no effect on the direction of BB Biotech i.e., BB Biotech and Banque Cantonale go up and down completely randomly.
Pair Corralation between BB Biotech and Banque Cantonale
Assuming the 90 days trading horizon BB Biotech AG is expected to under-perform the Banque Cantonale. In addition to that, BB Biotech is 3.48 times more volatile than Banque Cantonale du. It trades about -0.07 of its total potential returns per unit of risk. Banque Cantonale du is currently generating about -0.04 per unit of volatility. If you would invest 11,200 in Banque Cantonale du on August 24, 2024 and sell it today you would lose (50.00) from holding Banque Cantonale du or give up 0.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BB Biotech AG vs. Banque Cantonale du
Performance |
| Timeline |
| BB Biotech AG |
| Banque Cantonale |
BB Biotech and Banque Cantonale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BB Biotech and Banque Cantonale
The main advantage of trading using opposite BB Biotech and Banque Cantonale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BB Biotech position performs unexpectedly, Banque Cantonale 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 Banque Cantonale will offset losses from the drop in Banque Cantonale's long position.| BB Biotech vs. Santhera Pharmaceuticals Holding | BB Biotech vs. Evolva Holding SA | BB Biotech vs. COSMO Pharmaceuticals SA |
| Banque Cantonale vs. BB Biotech AG | Banque Cantonale vs. Adval Tech Holding | Banque Cantonale vs. Basler Kantonalbank | Banque Cantonale vs. Zurich Insurance Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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