Correlation Between Burning Rock and BioAffinity Technologies

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

Diversification Opportunities for Burning Rock and BioAffinity Technologies

BurningBioAffinityDiversified AwayBurningBioAffinityDiversified Away100%
-0.31
  Correlation Coefficient

Very good diversification

The 3 months correlation between Burning and BioAffinity is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Burning Rock Biotech and bioAffinity Technologies Warra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioAffinity Technologies and Burning Rock 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 Burning Rock Biotech are associated (or correlated) with BioAffinity Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioAffinity Technologies has no effect on the direction of Burning Rock i.e., Burning Rock and BioAffinity Technologies go up and down completely randomly.

Pair Corralation between Burning Rock and BioAffinity Technologies

Considering the 90-day investment horizon Burning Rock Biotech is expected to under-perform the BioAffinity Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Burning Rock Biotech is 11.42 times less risky than BioAffinity Technologies. The stock trades about -0.04 of its potential returns per unit of risk. The bioAffinity Technologies Warrant is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  33.00  in bioAffinity Technologies Warrant on December 4, 2024 and sell it today you would lose (3.97) from holding bioAffinity Technologies Warrant or give up 12.03% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy72.94%
ValuesDaily Returns

Burning Rock Biotech  vs.  bioAffinity Technologies Warra

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -60-40-2002040
JavaScript chart by amCharts 3.21.15BNR BIAFW
       Timeline  
Burning Rock Biotech 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Burning Rock Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar5.566.577.5
BioAffinity Technologies 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in bioAffinity Technologies Warrant are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile technical and fundamental indicators, BioAffinity Technologies showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebMarJanFebMar0.30.40.50.60.70.80.911.1

Burning Rock and BioAffinity Technologies Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-21.2-15.88-10.55-5.230.075.2710.7216.1821.6327.08 0.0010.0020.0030.0040.0050.0060.0070.008
JavaScript chart by amCharts 3.21.15BNR BIAFW
       Returns  

Pair Trading with Burning Rock and BioAffinity Technologies

The main advantage of trading using opposite Burning Rock and BioAffinity Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burning Rock position performs unexpectedly, BioAffinity Technologies 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 BioAffinity Technologies will offset losses from the drop in BioAffinity Technologies' long position.
The idea behind Burning Rock Biotech and bioAffinity Technologies Warrant 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.
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.

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