Correlation Between H B and BioNexus Gene
Can any of the company-specific risk be diversified away by investing in both H B and BioNexus Gene 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 H B and BioNexus Gene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between H B Fuller and BioNexus Gene Lab, you can compare the effects of market volatilities on H B and BioNexus Gene 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 H B with a short position of BioNexus Gene. Check out your portfolio center. Please also check ongoing floating volatility patterns of H B and BioNexus Gene.
Diversification Opportunities for H B and BioNexus Gene
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FUL and BioNexus is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding H B Fuller and BioNexus Gene Lab in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNexus Gene Lab and H B 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 H B Fuller are associated (or correlated) with BioNexus Gene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioNexus Gene Lab has no effect on the direction of H B i.e., H B and BioNexus Gene go up and down completely randomly.
Pair Corralation between H B and BioNexus Gene
Considering the 90-day investment horizon H B Fuller is expected to generate 0.48 times more return on investment than BioNexus Gene. However, H B Fuller is 2.08 times less risky than BioNexus Gene. It trades about 0.1 of its potential returns per unit of risk. BioNexus Gene Lab is currently generating about -0.48 per unit of risk. If you would invest 7,534 in H B Fuller on August 28, 2024 and sell it today you would earn a total of 265.00 from holding H B Fuller or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
H B Fuller vs. BioNexus Gene Lab
Performance |
| Timeline |
| H B Fuller |
| BioNexus Gene Lab |
H B and BioNexus Gene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with H B and BioNexus Gene
The main advantage of trading using opposite H B and BioNexus Gene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H B position performs unexpectedly, BioNexus Gene 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 BioNexus Gene will offset losses from the drop in BioNexus Gene's long position.The idea behind H B Fuller and BioNexus Gene Lab 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.| BioNexus Gene vs. Oil Dri | BioNexus Gene vs. H B Fuller | BioNexus Gene vs. Northern Technologies | BioNexus Gene vs. Cabot |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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