Correlation Between Cicor Technologies and BB Biotech
Can any of the company-specific risk be diversified away by investing in both Cicor Technologies and BB Biotech 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 Cicor Technologies and BB Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cicor Technologies and BB Biotech AG, you can compare the effects of market volatilities on Cicor Technologies and BB Biotech 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 Cicor Technologies with a short position of BB Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cicor Technologies and BB Biotech.
Diversification Opportunities for Cicor Technologies and BB Biotech
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cicor and BION is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cicor Technologies and BB Biotech AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BB Biotech AG and Cicor Technologies 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 Cicor Technologies are associated (or correlated) with BB Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BB Biotech AG has no effect on the direction of Cicor Technologies i.e., Cicor Technologies and BB Biotech go up and down completely randomly.
Pair Corralation between Cicor Technologies and BB Biotech
Assuming the 90 days trading horizon Cicor Technologies is expected to generate 1.15 times more return on investment than BB Biotech. However, Cicor Technologies is 1.15 times more volatile than BB Biotech AG. It trades about 0.19 of its potential returns per unit of risk. BB Biotech AG is currently generating about 0.07 per unit of risk. If you would invest 5,280 in Cicor Technologies on August 28, 2024 and sell it today you would earn a total of 380.00 from holding Cicor Technologies or generate 7.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cicor Technologies vs. BB Biotech AG
Performance |
| Timeline |
| Cicor Technologies |
| BB Biotech AG |
Cicor Technologies and BB Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cicor Technologies and BB Biotech
The main advantage of trading using opposite Cicor Technologies and BB Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cicor Technologies position performs unexpectedly, BB Biotech 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 BB Biotech will offset losses from the drop in BB Biotech's long position.| Cicor Technologies vs. Santhera Pharmaceuticals Holding | Cicor Technologies vs. Newron Pharmaceuticals SpA | Cicor Technologies vs. Basilea Pharmaceutica AG | Cicor Technologies vs. Evolva Holding SA |
| BB Biotech vs. Swiss Life Holding | BB Biotech vs. Swiss Re AG | BB Biotech vs. Helvetia Holding AG | BB Biotech vs. Partners Group Holding |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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