Correlation Between Bristol Myers and BioRestorative Therapies
Can any of the company-specific risk be diversified away by investing in both Bristol Myers and BioRestorative Therapies 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 BioRestorative Therapies 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 BioRestorative Therapies, you can compare the effects of market volatilities on Bristol Myers and BioRestorative Therapies 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 BioRestorative Therapies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol Myers and BioRestorative Therapies.
Diversification Opportunities for Bristol Myers and BioRestorative Therapies
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bristol and BioRestorative is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and BioRestorative Therapies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioRestorative Therapies 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 BioRestorative Therapies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioRestorative Therapies has no effect on the direction of Bristol Myers i.e., Bristol Myers and BioRestorative Therapies go up and down completely randomly.
Pair Corralation between Bristol Myers and BioRestorative Therapies
Considering the 90-day investment horizon Bristol Myers Squibb is expected to generate 0.25 times more return on investment than BioRestorative Therapies. However, Bristol Myers Squibb is 4.07 times less risky than BioRestorative Therapies. It trades about 0.0 of its potential returns per unit of risk. BioRestorative Therapies is currently generating about -0.01 per unit of risk. If you would invest 6,049 in Bristol Myers Squibb on September 2, 2024 and sell it today you would lose (127.00) from holding Bristol Myers Squibb or give up 2.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bristol Myers Squibb vs. BioRestorative Therapies
Performance |
| Timeline |
| Bristol Myers Squibb |
| BioRestorative Therapies |
Bristol Myers and BioRestorative Therapies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol Myers and BioRestorative Therapies
The main advantage of trading using opposite Bristol Myers and BioRestorative Therapies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol Myers position performs unexpectedly, BioRestorative Therapies 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 BioRestorative Therapies will offset losses from the drop in BioRestorative Therapies' long position.| Bristol Myers vs. AbbVie Inc | Bristol Myers vs. Merck Company | Bristol Myers vs. Gilead Sciences | Bristol Myers vs. Johnson Johnson |
| BioRestorative Therapies vs. Tff Pharmaceuticals | BioRestorative Therapies vs. Eliem Therapeutics | BioRestorative Therapies vs. Inhibrx | BioRestorative Therapies vs. Enliven 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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