Correlation Between Fresh Tracks and Biocardia
Can any of the company-specific risk be diversified away by investing in both Fresh Tracks and Biocardia 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 Fresh Tracks and Biocardia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresh Tracks Therapeutics and Biocardia, you can compare the effects of market volatilities on Fresh Tracks and Biocardia 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 Fresh Tracks with a short position of Biocardia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresh Tracks and Biocardia.
Diversification Opportunities for Fresh Tracks and Biocardia
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fresh and Biocardia is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Fresh Tracks Therapeutics and Biocardia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biocardia and Fresh Tracks 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 Fresh Tracks Therapeutics are associated (or correlated) with Biocardia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biocardia has no effect on the direction of Fresh Tracks i.e., Fresh Tracks and Biocardia go up and down completely randomly.
Pair Corralation between Fresh Tracks and Biocardia
Given the investment horizon of 90 days Fresh Tracks Therapeutics is expected to generate 0.97 times more return on investment than Biocardia. However, Fresh Tracks Therapeutics is 1.03 times less risky than Biocardia. It trades about 0.11 of its potential returns per unit of risk. Biocardia is currently generating about -0.02 per unit of risk. If you would invest 64.00 in Fresh Tracks Therapeutics on September 2, 2024 and sell it today you would earn a total of 14.00 from holding Fresh Tracks Therapeutics or generate 21.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 8.06% |
| Values | Daily Returns |
Fresh Tracks Therapeutics vs. Biocardia
Performance |
| Timeline |
| Fresh Tracks Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Biocardia |
Fresh Tracks and Biocardia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresh Tracks and Biocardia
The main advantage of trading using opposite Fresh Tracks and Biocardia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresh Tracks position performs unexpectedly, Biocardia 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 Biocardia will offset losses from the drop in Biocardia's long position.| Fresh Tracks vs. Assembly Biosciences | Fresh Tracks vs. Instil Bio | Fresh Tracks vs. Nuvation Bio | Fresh Tracks vs. Achilles Therapeutics PLC |
| Biocardia vs. Aerovate Therapeutics | Biocardia vs. Adagene | Biocardia vs. Acrivon Therapeutics, Common | Biocardia vs. Rezolute |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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