Correlation Between EssilorLuxottica and Bionano Genomics
Can any of the company-specific risk be diversified away by investing in both EssilorLuxottica and Bionano Genomics 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 EssilorLuxottica and Bionano Genomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EssilorLuxottica Socit anonyme and Bionano Genomics, you can compare the effects of market volatilities on EssilorLuxottica and Bionano Genomics 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 EssilorLuxottica with a short position of Bionano Genomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of EssilorLuxottica and Bionano Genomics.
Diversification Opportunities for EssilorLuxottica and Bionano Genomics
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EssilorLuxottica and Bionano is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding EssilorLuxottica Socit anonyme and Bionano Genomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bionano Genomics and EssilorLuxottica 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 EssilorLuxottica Socit anonyme are associated (or correlated) with Bionano Genomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bionano Genomics has no effect on the direction of EssilorLuxottica i.e., EssilorLuxottica and Bionano Genomics go up and down completely randomly.
Pair Corralation between EssilorLuxottica and Bionano Genomics
Assuming the 90 days horizon EssilorLuxottica Socit anonyme is expected to generate 0.35 times more return on investment than Bionano Genomics. However, EssilorLuxottica Socit anonyme is 2.9 times less risky than Bionano Genomics. It trades about 0.04 of its potential returns per unit of risk. Bionano Genomics is currently generating about -0.14 per unit of risk. If you would invest 18,488 in EssilorLuxottica Socit anonyme on September 3, 2024 and sell it today you would earn a total of 5,713 from holding EssilorLuxottica Socit anonyme or generate 30.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EssilorLuxottica Socit anonyme vs. Bionano Genomics
Performance |
| Timeline |
| EssilorLuxottica Socit |
| Bionano Genomics |
EssilorLuxottica and Bionano Genomics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EssilorLuxottica and Bionano Genomics
The main advantage of trading using opposite EssilorLuxottica and Bionano Genomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EssilorLuxottica position performs unexpectedly, Bionano Genomics 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 Bionano Genomics will offset losses from the drop in Bionano Genomics' long position.| EssilorLuxottica vs. BioLife Sciences | EssilorLuxottica vs. CeCors Inc | EssilorLuxottica vs. GlucoTrack | EssilorLuxottica vs. Sharps Technology |
| Bionano Genomics vs. Intuitive Surgical | Bionano Genomics vs. Innovative Eyewear | Bionano Genomics vs. Stereotaxis | Bionano Genomics vs. Nexgel Inc |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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