Correlation Between Legend Biotech and Bio Techne
Can any of the company-specific risk be diversified away by investing in both Legend Biotech and Bio Techne 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 Legend Biotech and Bio Techne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legend Biotech Corp and Bio Techne Corp, you can compare the effects of market volatilities on Legend Biotech and Bio Techne 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 Legend Biotech with a short position of Bio Techne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legend Biotech and Bio Techne.
Diversification Opportunities for Legend Biotech and Bio Techne
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Legend and Bio is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Legend Biotech Corp and Bio Techne Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Techne Corp and Legend Biotech 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 Legend Biotech Corp are associated (or correlated) with Bio Techne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Techne Corp has no effect on the direction of Legend Biotech i.e., Legend Biotech and Bio Techne go up and down completely randomly.
Pair Corralation between Legend Biotech and Bio Techne
Given the investment horizon of 90 days Legend Biotech Corp is expected to generate 1.26 times more return on investment than Bio Techne. However, Legend Biotech is 1.26 times more volatile than Bio Techne Corp. It trades about -0.06 of its potential returns per unit of risk. Bio Techne Corp is currently generating about -0.22 per unit of risk. If you would invest 3,403 in Legend Biotech Corp on January 9, 2025 and sell it today you would lose (195.00) from holding Legend Biotech Corp or give up 5.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Legend Biotech Corp vs. Bio Techne Corp
Performance |
| Timeline |
| Legend Biotech Corp |
| Bio Techne Corp |
Legend Biotech and Bio Techne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legend Biotech and Bio Techne
The main advantage of trading using opposite Legend Biotech and Bio Techne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legend Biotech position performs unexpectedly, Bio Techne 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 Techne will offset losses from the drop in Bio Techne's long position.| Legend Biotech vs. Vaxcyte | Legend Biotech vs. Apellis Pharmaceuticals | Legend Biotech vs. Travere Therapeutics | Legend Biotech vs. Akero Therapeutics |
| Bio Techne vs. Biomarin Pharmaceutical | Bio Techne vs. Vaxcyte | Bio Techne vs. Liquidia Technologies | Bio Techne vs. Legend Biotech Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |