Correlation Between MFF Capital and Bio Gene
Can any of the company-specific risk be diversified away by investing in both MFF Capital and Bio 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 MFF Capital and Bio Gene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFF Capital Investments and Bio Gene Technology, you can compare the effects of market volatilities on MFF Capital and Bio 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 MFF Capital with a short position of Bio Gene. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFF Capital and Bio Gene.
Diversification Opportunities for MFF Capital and Bio Gene
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MFF and Bio is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding MFF Capital Investments and Bio Gene Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Gene Technology and MFF Capital 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 MFF Capital Investments are associated (or correlated) with Bio Gene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Gene Technology has no effect on the direction of MFF Capital i.e., MFF Capital and Bio Gene go up and down completely randomly.
Pair Corralation between MFF Capital and Bio Gene
Assuming the 90 days trading horizon MFF Capital Investments is expected to generate 0.19 times more return on investment than Bio Gene. However, MFF Capital Investments is 5.31 times less risky than Bio Gene. It trades about 0.14 of its potential returns per unit of risk. Bio Gene Technology is currently generating about -0.01 per unit of risk. If you would invest 217.00 in MFF Capital Investments on September 4, 2024 and sell it today you would earn a total of 218.00 from holding MFF Capital Investments or generate 100.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFF Capital Investments vs. Bio Gene Technology
Performance |
| Timeline |
| MFF Capital Investments |
| Bio Gene Technology |
MFF Capital and Bio Gene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFF Capital and Bio Gene
The main advantage of trading using opposite MFF Capital and Bio Gene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFF Capital position performs unexpectedly, Bio 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 Bio Gene will offset losses from the drop in Bio Gene's long position.| MFF Capital vs. Global Health | MFF Capital vs. Healthco Healthcare and | MFF Capital vs. Beston Global Food | MFF Capital vs. BTC Health Limited |
| Bio Gene vs. Northern Star Resources | Bio Gene vs. Evolution Mining | Bio Gene vs. Bluescope Steel | Bio Gene vs. Sandfire Resources NL |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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