Correlation Between Intervacc and Bio Works
Can any of the company-specific risk be diversified away by investing in both Intervacc and Bio Works 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 Intervacc and Bio Works into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intervacc AB and Bio Works Technologies AB, you can compare the effects of market volatilities on Intervacc and Bio Works 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 Intervacc with a short position of Bio Works. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intervacc and Bio Works.
Diversification Opportunities for Intervacc and Bio Works
Poor diversification
The 3 months correlation between Intervacc and Bio is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Intervacc AB and Bio Works Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Works Technologies and Intervacc 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 Intervacc AB are associated (or correlated) with Bio Works. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Works Technologies has no effect on the direction of Intervacc i.e., Intervacc and Bio Works go up and down completely randomly.
Pair Corralation between Intervacc and Bio Works
Assuming the 90 days trading horizon Intervacc AB is expected to under-perform the Bio Works. In addition to that, Intervacc is 1.29 times more volatile than Bio Works Technologies AB. It trades about -0.05 of its total potential returns per unit of risk. Bio Works Technologies AB is currently generating about 0.09 per unit of volatility. If you would invest 85.00 in Bio Works Technologies AB on September 1, 2024 and sell it today you would earn a total of 6.00 from holding Bio Works Technologies AB or generate 7.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intervacc AB vs. Bio Works Technologies AB
Performance |
| Timeline |
| Intervacc AB |
| Bio Works Technologies |
Intervacc and Bio Works Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intervacc and Bio Works
The main advantage of trading using opposite Intervacc and Bio Works positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intervacc position performs unexpectedly, Bio Works 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 Bio Works will offset losses from the drop in Bio Works' long position.The idea behind Intervacc AB and Bio Works Technologies AB 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.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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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