Correlation Between Bridge Biotherapeutics and Genolution
Can any of the company-specific risk be diversified away by investing in both Bridge Biotherapeutics and Genolution 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 Bridge Biotherapeutics and Genolution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bridge Biotherapeutics and Genolution, you can compare the effects of market volatilities on Bridge Biotherapeutics and Genolution 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 Bridge Biotherapeutics with a short position of Genolution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridge Biotherapeutics and Genolution.
Diversification Opportunities for Bridge Biotherapeutics and Genolution
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bridge and Genolution is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Bridge Biotherapeutics and Genolution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genolution and Bridge Biotherapeutics 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 Bridge Biotherapeutics are associated (or correlated) with Genolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genolution has no effect on the direction of Bridge Biotherapeutics i.e., Bridge Biotherapeutics and Genolution go up and down completely randomly.
Pair Corralation between Bridge Biotherapeutics and Genolution
Assuming the 90 days trading horizon Bridge Biotherapeutics is expected to generate 3.48 times more return on investment than Genolution. However, Bridge Biotherapeutics is 3.48 times more volatile than Genolution. It trades about 0.03 of its potential returns per unit of risk. Genolution is currently generating about -0.25 per unit of risk. If you would invest 414,000 in Bridge Biotherapeutics on September 24, 2024 and sell it today you would lose (20,000) from holding Bridge Biotherapeutics or give up 4.83% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Bridge Biotherapeutics vs. Genolution
Performance |
Timeline |
Bridge Biotherapeutics |
Genolution |
Bridge Biotherapeutics and Genolution Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bridge Biotherapeutics and Genolution
The main advantage of trading using opposite Bridge Biotherapeutics and Genolution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bridge Biotherapeutics position performs unexpectedly, Genolution 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 Genolution will offset losses from the drop in Genolution's long position.Bridge Biotherapeutics vs. KNOTUS CoLtd | Bridge Biotherapeutics vs. AptaBio Therapeutics | Bridge Biotherapeutics vs. Cytogen | Bridge Biotherapeutics vs. Genolution |
Genolution vs. KNOTUS CoLtd | Genolution vs. Bridge Biotherapeutics | Genolution vs. AptaBio Therapeutics | Genolution vs. Cytogen |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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