Correlation Between Lanakam SA and Bioter SA
Can any of the company-specific risk be diversified away by investing in both Lanakam SA and Bioter SA 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 Lanakam SA and Bioter SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lanakam SA and Bioter SA, you can compare the effects of market volatilities on Lanakam SA and Bioter SA 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 Lanakam SA with a short position of Bioter SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lanakam SA and Bioter SA.
Diversification Opportunities for Lanakam SA and Bioter SA
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lanakam and Bioter is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Lanakam SA and Bioter SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bioter SA and Lanakam SA 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 Lanakam SA are associated (or correlated) with Bioter SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bioter SA has no effect on the direction of Lanakam SA i.e., Lanakam SA and Bioter SA go up and down completely randomly.
Pair Corralation between Lanakam SA and Bioter SA
Assuming the 90 days trading horizon Lanakam SA is expected to under-perform the Bioter SA. In addition to that, Lanakam SA is 1.11 times more volatile than Bioter SA. It trades about -0.02 of its total potential returns per unit of risk. Bioter SA is currently generating about 0.01 per unit of volatility. If you would invest 25.00 in Bioter SA on November 4, 2024 and sell it today you would earn a total of 0.00 from holding Bioter SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Lanakam SA vs. Bioter SA
Performance |
| Timeline |
| Lanakam SA |
| Bioter SA |
Lanakam SA and Bioter SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lanakam SA and Bioter SA
The main advantage of trading using opposite Lanakam SA and Bioter SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lanakam SA position performs unexpectedly, Bioter SA 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 Bioter SA will offset losses from the drop in Bioter SA's long position.| Lanakam SA vs. Daios Plastics SA | Lanakam SA vs. Optima bank SA | Lanakam SA vs. Lampsa Hellenic Hotels | Lanakam SA vs. Piraeus Financial Holdings |
| Bioter SA vs. Avax SA | Bioter SA vs. Ekter SA | Bioter SA vs. Intracom Constructions Societe | Bioter SA vs. Alumil Aluminium Industry |
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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