Correlation Between Sofina Socit and Biocartis Group
Can any of the company-specific risk be diversified away by investing in both Sofina Socit and Biocartis Group 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 Sofina Socit and Biocartis Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sofina Socit Anonyme and Biocartis Group NV, you can compare the effects of market volatilities on Sofina Socit and Biocartis Group 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 Sofina Socit with a short position of Biocartis Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sofina Socit and Biocartis Group.
Diversification Opportunities for Sofina Socit and Biocartis Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sofina and Biocartis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sofina Socit Anonyme and Biocartis Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biocartis Group NV and Sofina Socit 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 Sofina Socit Anonyme are associated (or correlated) with Biocartis Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biocartis Group NV has no effect on the direction of Sofina Socit i.e., Sofina Socit and Biocartis Group go up and down completely randomly.
Pair Corralation between Sofina Socit and Biocartis Group
Assuming the 90 days trading horizon Sofina Socit Anonyme is expected to generate 0.81 times more return on investment than Biocartis Group. However, Sofina Socit Anonyme is 1.23 times less risky than Biocartis Group. It trades about 0.01 of its potential returns per unit of risk. Biocartis Group NV is currently generating about -0.06 per unit of risk. If you would invest 21,745 in Sofina Socit Anonyme on September 3, 2024 and sell it today you would earn a total of 175.00 from holding Sofina Socit Anonyme or generate 0.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Sofina Socit Anonyme vs. Biocartis Group NV
Performance |
| Timeline |
| Sofina Socit Anonyme |
| Biocartis Group NV |
Sofina Socit and Biocartis Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sofina Socit and Biocartis Group
The main advantage of trading using opposite Sofina Socit and Biocartis Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sofina Socit position performs unexpectedly, Biocartis Group 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 Biocartis Group will offset losses from the drop in Biocartis Group's long position.| Sofina Socit vs. Onward Medical NV | Sofina Socit vs. Retail Estates | Sofina Socit vs. Keyware Technologies NV |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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