Correlation Between Biotron and Bonus BioGroup

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Can any of the company-specific risk be diversified away by investing in both Biotron and Bonus BioGroup 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 Biotron and Bonus BioGroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biotron Limited and Bonus BioGroup, you can compare the effects of market volatilities on Biotron and Bonus BioGroup 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 Biotron with a short position of Bonus BioGroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biotron and Bonus BioGroup.

Diversification Opportunities for Biotron and Bonus BioGroup

-0.23
  Correlation Coefficient

Very good diversification

The 3 months correlation between Biotron and Bonus is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Biotron Limited and Bonus BioGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonus BioGroup and Biotron 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 Biotron Limited are associated (or correlated) with Bonus BioGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonus BioGroup has no effect on the direction of Biotron i.e., Biotron and Bonus BioGroup go up and down completely randomly.

Pair Corralation between Biotron and Bonus BioGroup

If you would invest  2.00  in Bonus BioGroup on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Bonus BioGroup or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Biotron Limited  vs.  Bonus BioGroup

 Performance 
       Timeline  
Biotron Limited 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Biotron Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Biotron may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Bonus BioGroup 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Bonus BioGroup has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Biotron and Bonus BioGroup Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Biotron and Bonus BioGroup

The main advantage of trading using opposite Biotron and Bonus BioGroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biotron position performs unexpectedly, Bonus BioGroup 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 Bonus BioGroup will offset losses from the drop in Bonus BioGroup's long position.
Biotron vs. Sino Biopharmaceutical Ltd
Biotron vs. Defence Therapeutics
Biotron vs. Aileron Therapeutics
Biotron vs. Enlivex Therapeutics
The idea behind Biotron Limited and Bonus BioGroup pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
Bonus BioGroup vs. Sino Biopharmaceutical Ltd
Bonus BioGroup vs. Defence Therapeutics
Bonus BioGroup vs. Aileron Therapeutics
Bonus BioGroup vs. Enlivex Therapeutics
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.

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