Correlation Between Biotage AB and BTS Group
Can any of the company-specific risk be diversified away by investing in both Biotage AB and BTS Group 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 Biotage AB and BTS Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biotage AB and BTS Group AB, you can compare the effects of market volatilities on Biotage AB and BTS Group 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 Biotage AB with a short position of BTS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biotage AB and BTS Group.
Diversification Opportunities for Biotage AB and BTS Group
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Biotage and BTS is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Biotage AB and BTS Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTS Group AB and Biotage AB 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 Biotage AB are associated (or correlated) with BTS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTS Group AB has no effect on the direction of Biotage AB i.e., Biotage AB and BTS Group go up and down completely randomly.
Pair Corralation between Biotage AB and BTS Group
Assuming the 90 days trading horizon Biotage AB is expected to generate 1.28 times more return on investment than BTS Group. However, Biotage AB is 1.28 times more volatile than BTS Group AB. It trades about 0.03 of its potential returns per unit of risk. BTS Group AB is currently generating about 0.02 per unit of risk. If you would invest 13,438 in Biotage AB on August 28, 2024 and sell it today you would earn a total of 2,112 from holding Biotage AB or generate 15.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biotage AB vs. BTS Group AB
Performance |
| Timeline |
| Biotage AB |
| BTS Group AB |
Biotage AB and BTS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biotage AB and BTS Group
The main advantage of trading using opposite Biotage AB and BTS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biotage AB position performs unexpectedly, BTS Group 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 BTS Group will offset losses from the drop in BTS Group's long position.| Biotage AB vs. CellaVision AB | Biotage AB vs. Vitrolife AB | Biotage AB vs. Sectra AB | Biotage AB vs. BioGaia AB |
| BTS Group vs. Biotage AB | BTS Group vs. Addnode Group AB | BTS Group vs. Beijer Ref AB | BTS Group vs. CellaVision 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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