Correlation Between Biovie and Gain Therapeutics
Can any of the company-specific risk be diversified away by investing in both Biovie and Gain Therapeutics 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 Biovie and Gain Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biovie Inc and Gain Therapeutics, you can compare the effects of market volatilities on Biovie and Gain Therapeutics 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 Biovie with a short position of Gain Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biovie and Gain Therapeutics.
Diversification Opportunities for Biovie and Gain Therapeutics
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Biovie and Gain is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Biovie Inc and Gain Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gain Therapeutics and Biovie 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 Biovie Inc are associated (or correlated) with Gain Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gain Therapeutics has no effect on the direction of Biovie i.e., Biovie and Gain Therapeutics go up and down completely randomly.
Pair Corralation between Biovie and Gain Therapeutics
Given the investment horizon of 90 days Biovie Inc is expected to under-perform the Gain Therapeutics. In addition to that, Biovie is 1.95 times more volatile than Gain Therapeutics. It trades about -0.02 of its total potential returns per unit of risk. Gain Therapeutics is currently generating about 0.0 per unit of volatility. If you would invest 321.00 in Gain Therapeutics on August 29, 2024 and sell it today you would lose (147.00) from holding Gain Therapeutics or give up 45.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biovie Inc vs. Gain Therapeutics
Performance |
| Timeline |
| Biovie Inc |
| Gain Therapeutics |
Biovie and Gain Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biovie and Gain Therapeutics
The main advantage of trading using opposite Biovie and Gain Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biovie position performs unexpectedly, Gain Therapeutics 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 Gain Therapeutics will offset losses from the drop in Gain Therapeutics' long position.| Biovie vs. Inozyme Pharma | Biovie vs. Day One Biopharmaceuticals | Biovie vs. Terns Pharmaceuticals | Biovie vs. Eledon Pharmaceuticals |
| Gain Therapeutics vs. Biovie Inc | Gain Therapeutics vs. In8bio Inc | Gain Therapeutics vs. NewAmsterdam Pharma | Gain Therapeutics vs. Cue Biopharma |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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