Correlation Between Biogen and H FARM
Can any of the company-specific risk be diversified away by investing in both Biogen and H FARM 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 Biogen and H FARM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biogen Inc and H FARM SPA, you can compare the effects of market volatilities on Biogen and H FARM 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 Biogen with a short position of H FARM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biogen and H FARM.
Diversification Opportunities for Biogen and H FARM
Poor diversification
The 3 months correlation between Biogen and 5JQ is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Biogen Inc and H FARM SPA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H FARM SPA and Biogen 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 Biogen Inc are associated (or correlated) with H FARM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H FARM SPA has no effect on the direction of Biogen i.e., Biogen and H FARM go up and down completely randomly.
Pair Corralation between Biogen and H FARM
Assuming the 90 days horizon Biogen Inc is expected to generate 0.27 times more return on investment than H FARM. However, Biogen Inc is 3.7 times less risky than H FARM. It trades about -0.13 of its potential returns per unit of risk. H FARM SPA is currently generating about -0.05 per unit of risk. If you would invest 15,835 in Biogen Inc on September 3, 2024 and sell it today you would lose (635.00) from holding Biogen Inc or give up 4.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biogen Inc vs. H FARM SPA
Performance |
| Timeline |
| Biogen Inc |
| H FARM SPA |
Biogen and H FARM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biogen and H FARM
The main advantage of trading using opposite Biogen and H FARM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biogen position performs unexpectedly, H FARM 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 H FARM will offset losses from the drop in H FARM's long position.| Biogen vs. Canon Marketing Japan | Biogen vs. Auto Trader Group | Biogen vs. Jacquet Metal Service | Biogen vs. CarsalesCom |
| H FARM vs. ADRIATIC METALS LS 013355 | H FARM vs. GALENA MINING LTD | H FARM vs. Sunny Optical Technology | H FARM vs. GREENX METALS LTD |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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