Correlation Between Therma Bright and Helix BioPharma
Can any of the company-specific risk be diversified away by investing in both Therma Bright and Helix BioPharma 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 Therma Bright and Helix BioPharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Therma Bright and Helix BioPharma Corp, you can compare the effects of market volatilities on Therma Bright and Helix BioPharma 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 Therma Bright with a short position of Helix BioPharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Therma Bright and Helix BioPharma.
Diversification Opportunities for Therma Bright and Helix BioPharma
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Therma and Helix is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Therma Bright and Helix BioPharma Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helix BioPharma Corp and Therma Bright 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 Therma Bright are associated (or correlated) with Helix BioPharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helix BioPharma Corp has no effect on the direction of Therma Bright i.e., Therma Bright and Helix BioPharma go up and down completely randomly.
Pair Corralation between Therma Bright and Helix BioPharma
Assuming the 90 days trading horizon Therma Bright is expected to under-perform the Helix BioPharma. But the stock apears to be less risky and, when comparing its historical volatility, Therma Bright is 1.16 times less risky than Helix BioPharma. The stock trades about -0.14 of its potential returns per unit of risk. The Helix BioPharma Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 76.00 in Helix BioPharma Corp on September 3, 2024 and sell it today you would earn a total of 11.00 from holding Helix BioPharma Corp or generate 14.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Therma Bright vs. Helix BioPharma Corp
Performance |
| Timeline |
| Therma Bright |
| Helix BioPharma Corp |
Therma Bright and Helix BioPharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Therma Bright and Helix BioPharma
The main advantage of trading using opposite Therma Bright and Helix BioPharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Therma Bright position performs unexpectedly, Helix BioPharma 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 Helix BioPharma will offset losses from the drop in Helix BioPharma's long position.| Therma Bright vs. Solar Alliance Energy | Therma Bright vs. Braille Energy Systems | Therma Bright vs. MedMira | Therma Bright vs. Lite Access Technologies |
| Helix BioPharma vs. Microbix Biosystems | Helix BioPharma vs. Oncolytics Biotech | Helix BioPharma vs. Spectral Med | Helix BioPharma vs. Theratechnologies |
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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