Correlation Between Bioventix and JLEN Environmental
Can any of the company-specific risk be diversified away by investing in both Bioventix and JLEN Environmental 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 Bioventix and JLEN Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bioventix and JLEN Environmental Assets, you can compare the effects of market volatilities on Bioventix and JLEN Environmental 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 Bioventix with a short position of JLEN Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bioventix and JLEN Environmental.
Diversification Opportunities for Bioventix and JLEN Environmental
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bioventix and JLEN is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bioventix and JLEN Environmental Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLEN Environmental Assets and Bioventix 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 Bioventix are associated (or correlated) with JLEN Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLEN Environmental Assets has no effect on the direction of Bioventix i.e., Bioventix and JLEN Environmental go up and down completely randomly.
Pair Corralation between Bioventix and JLEN Environmental
Assuming the 90 days trading horizon Bioventix is expected to generate 1.35 times more return on investment than JLEN Environmental. However, Bioventix is 1.35 times more volatile than JLEN Environmental Assets. It trades about -0.03 of its potential returns per unit of risk. JLEN Environmental Assets is currently generating about -0.07 per unit of risk. If you would invest 387,500 in Bioventix on November 27, 2024 and sell it today you would lose (90,000) from holding Bioventix or give up 23.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bioventix vs. JLEN Environmental Assets
Performance |
| Timeline |
| Bioventix |
| JLEN Environmental Assets |
Bioventix and JLEN Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bioventix and JLEN Environmental
The main advantage of trading using opposite Bioventix and JLEN Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bioventix position performs unexpectedly, JLEN Environmental 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 JLEN Environmental will offset losses from the drop in JLEN Environmental's long position.| Bioventix vs. AfriTin Mining | Bioventix vs. Southern Copper Corp | Bioventix vs. LPKF Laser Electronics | Bioventix vs. Electronic Arts |
| JLEN Environmental vs. Chrysalis Investments | JLEN Environmental vs. BlackRock Frontiers Investment | JLEN Environmental vs. New Residential Investment | JLEN Environmental vs. Ruffer Investment |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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