Correlation Between Thule Group and Biotage AB
Can any of the company-specific risk be diversified away by investing in both Thule Group and Biotage AB 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 Thule Group and Biotage AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thule Group AB and Biotage AB, you can compare the effects of market volatilities on Thule Group and Biotage AB 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 Thule Group with a short position of Biotage AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thule Group and Biotage AB.
Diversification Opportunities for Thule Group and Biotage AB
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Thule and Biotage is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Thule Group AB and Biotage AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biotage AB and Thule Group 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 Thule Group AB are associated (or correlated) with Biotage AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biotage AB has no effect on the direction of Thule Group i.e., Thule Group and Biotage AB go up and down completely randomly.
Pair Corralation between Thule Group and Biotage AB
Assuming the 90 days trading horizon Thule Group AB is expected to generate 0.49 times more return on investment than Biotage AB. However, Thule Group AB is 2.04 times less risky than Biotage AB. It trades about 0.07 of its potential returns per unit of risk. Biotage AB is currently generating about -0.17 per unit of risk. If you would invest 34,440 in Thule Group AB on November 3, 2024 and sell it today you would earn a total of 760.00 from holding Thule Group AB or generate 2.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thule Group AB vs. Biotage AB
Performance |
| Timeline |
| Thule Group AB |
| Biotage AB |
Thule Group and Biotage AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thule Group and Biotage AB
The main advantage of trading using opposite Thule Group and Biotage AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thule Group position performs unexpectedly, Biotage AB 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 Biotage AB will offset losses from the drop in Biotage AB's long position.| Thule Group vs. MIPS AB | Thule Group vs. NIBE Industrier AB | Thule Group vs. Dometic Group AB | Thule Group vs. Husqvarna AB |
| Biotage AB vs. BioArctic AB | Biotage AB vs. Camurus AB | Biotage AB vs. Xvivo Perfusion AB | Biotage AB vs. Surgical Science Sweden |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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