Correlation Between Bristol Myers and Abeona Therapeutics
Can any of the company-specific risk be diversified away by investing in both Bristol Myers and Abeona 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 Bristol Myers and Abeona Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bristol Myers Squibb and Abeona Therapeutics, you can compare the effects of market volatilities on Bristol Myers and Abeona 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 Bristol Myers with a short position of Abeona Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol Myers and Abeona Therapeutics.
Diversification Opportunities for Bristol Myers and Abeona Therapeutics
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bristol and Abeona is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and Abeona Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abeona Therapeutics and Bristol Myers 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 Bristol Myers Squibb are associated (or correlated) with Abeona Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abeona Therapeutics has no effect on the direction of Bristol Myers i.e., Bristol Myers and Abeona Therapeutics go up and down completely randomly.
Pair Corralation between Bristol Myers and Abeona Therapeutics
Considering the 90-day investment horizon Bristol Myers Squibb is expected to under-perform the Abeona Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Bristol Myers Squibb is 3.15 times less risky than Abeona Therapeutics. The stock trades about -0.01 of its potential returns per unit of risk. The Abeona Therapeutics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 235.00 in Abeona Therapeutics on November 9, 2024 and sell it today you would earn a total of 353.00 from holding Abeona Therapeutics or generate 150.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bristol Myers Squibb vs. Abeona Therapeutics
Performance |
| Timeline |
| Bristol Myers Squibb |
| Abeona Therapeutics |
Bristol Myers and Abeona Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol Myers and Abeona Therapeutics
The main advantage of trading using opposite Bristol Myers and Abeona Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol Myers position performs unexpectedly, Abeona 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 Abeona Therapeutics will offset losses from the drop in Abeona Therapeutics' long position.| Bristol Myers vs. AbbVie Inc | Bristol Myers vs. Merck Company | Bristol Myers vs. Gilead Sciences | Bristol Myers vs. Johnson Johnson |
| Abeona Therapeutics vs. Reviva Pharmaceuticals Holdings | Abeona Therapeutics vs. Athira Pharma | Abeona Therapeutics vs. Fortress Biotech | Abeona Therapeutics vs. ACADIA Pharmaceuticals |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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