Correlation Between EirGenix and SynCore Biotechnology

Can any of the company-specific risk be diversified away by investing in both EirGenix and SynCore Biotechnology 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 EirGenix and SynCore Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EirGenix and SynCore Biotechnology Co, you can compare the effects of market volatilities on EirGenix and SynCore Biotechnology 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 EirGenix with a short position of SynCore Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of EirGenix and SynCore Biotechnology.

Diversification Opportunities for EirGenix and SynCore Biotechnology

0.41

Correlation Coefficient

EirGenix  SynCore Biotechnology

Very weak diversification

The 3 months correlation between EirGenix and SynCore is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding EirGenix and SynCore Biotechnology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SynCore Biotechnology and EirGenix 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 EirGenix are associated (or correlated) with SynCore Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SynCore Biotechnology has no effect on the direction of EirGenix i.e., EirGenix and SynCore Biotechnology go up and down completely randomly.

Pair Corralation between EirGenix and SynCore Biotechnology

Assuming the 90 days trading horizon EirGenix is expected to generate 0.91 times more return on investment than SynCore Biotechnology. However, EirGenix is 1.1 times less risky than SynCore Biotechnology. It trades about -0.04 of its potential returns per unit of risk. SynCore Biotechnology Co is currently generating about -0.08 per unit of risk. If you would invest  11,750  in EirGenix on September 29, 2024 and sell it today you would lose (4,660) from holding EirGenix or give up 39.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.79%
Values	Daily Returns

EirGenix  vs.  SynCore Biotechnology Co

EirGenix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EirGenix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

SynCore Biotechnology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SynCore Biotechnology Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with EirGenix and SynCore Biotechnology

The main advantage of trading using opposite EirGenix and SynCore Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EirGenix position performs unexpectedly, SynCore Biotechnology 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 SynCore Biotechnology will offset losses from the drop in SynCore Biotechnology's long position.

The idea behind EirGenix and SynCore Biotechnology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Equity Valuation module to check real value of public entities based on technical and fundamental data.