Correlation Between BioMark Diagnostics and Biodesix
Can any of the company-specific risk be diversified away by investing in both BioMark Diagnostics and Biodesix 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 BioMark Diagnostics and Biodesix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioMark Diagnostics and Biodesix, you can compare the effects of market volatilities on BioMark Diagnostics and Biodesix 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 BioMark Diagnostics with a short position of Biodesix. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioMark Diagnostics and Biodesix.
Diversification Opportunities for BioMark Diagnostics and Biodesix
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BioMark and Biodesix is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding BioMark Diagnostics and Biodesix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biodesix and BioMark Diagnostics 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 BioMark Diagnostics are associated (or correlated) with Biodesix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biodesix has no effect on the direction of BioMark Diagnostics i.e., BioMark Diagnostics and Biodesix go up and down completely randomly.
Pair Corralation between BioMark Diagnostics and Biodesix
Assuming the 90 days horizon BioMark Diagnostics is expected to generate 0.55 times more return on investment than Biodesix. However, BioMark Diagnostics is 1.83 times less risky than Biodesix. It trades about 0.01 of its potential returns per unit of risk. Biodesix is currently generating about -0.09 per unit of risk. If you would invest 15.00 in BioMark Diagnostics on September 14, 2024 and sell it today you would earn a total of 0.00 from holding BioMark Diagnostics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
BioMark Diagnostics vs. Biodesix
Performance |
| Timeline |
| BioMark Diagnostics |
| Biodesix |
BioMark Diagnostics and Biodesix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioMark Diagnostics and Biodesix
The main advantage of trading using opposite BioMark Diagnostics and Biodesix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioMark Diagnostics position performs unexpectedly, Biodesix 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 Biodesix will offset losses from the drop in Biodesix's long position.| BioMark Diagnostics vs. Neuronetics | BioMark Diagnostics vs. Intelligent Bio Solutions | BioMark Diagnostics vs. Biodesix | BioMark Diagnostics vs. Precipio |
| Biodesix vs. Puma Biotechnology | Biodesix vs. Iovance Biotherapeutics | Biodesix vs. Sarepta Therapeutics | Biodesix vs. Day One Biopharmaceuticals |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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