Correlation Between Biotage AB and Karnov Group
Can any of the company-specific risk be diversified away by investing in both Biotage AB and Karnov 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 Karnov 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 Karnov Group AB, you can compare the effects of market volatilities on Biotage AB and Karnov 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 Karnov Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biotage AB and Karnov Group.
Diversification Opportunities for Biotage AB and Karnov Group
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Biotage and Karnov is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Biotage AB and Karnov Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karnov 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 Karnov Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karnov Group AB has no effect on the direction of Biotage AB i.e., Biotage AB and Karnov Group go up and down completely randomly.
Pair Corralation between Biotage AB and Karnov Group
Assuming the 90 days trading horizon Biotage AB is expected to under-perform the Karnov Group. In addition to that, Biotage AB is 1.51 times more volatile than Karnov Group AB. It trades about -0.18 of its total potential returns per unit of risk. Karnov Group AB is currently generating about 0.04 per unit of volatility. If you would invest 7,980 in Karnov Group AB on August 29, 2024 and sell it today you would earn a total of 80.00 from holding Karnov Group AB or generate 1.0% 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. Karnov Group AB
Performance |
| Timeline |
| Biotage AB |
| Karnov Group AB |
Biotage AB and Karnov Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biotage AB and Karnov Group
The main advantage of trading using opposite Biotage AB and Karnov Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biotage AB position performs unexpectedly, Karnov 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 Karnov Group will offset losses from the drop in Karnov Group's long position.| Biotage AB vs. GomSpace Group AB | Biotage AB vs. Hansa Biopharma AB | Biotage AB vs. Zealand Pharma AS | Biotage AB vs. BioInvent International AB |
| Karnov Group vs. Attendo AB | Karnov Group vs. Ambea AB | Karnov Group vs. Inwido AB | Karnov Group vs. AcadeMedia 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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