Correlation Between Abionyx Pharma and Biophytis

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

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

Diversification Opportunities for Abionyx Pharma and Biophytis

-0.46

Correlation Coefficient

Abionyx Pharma  Biophytis

Very good diversification

The 3 months correlation between Abionyx and Biophytis is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Abionyx Pharma SA and Biophytis SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biophytis SA and Abionyx Pharma 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 Abionyx Pharma SA are associated (or correlated) with Biophytis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biophytis SA has no effect on the direction of Abionyx Pharma i.e., Abionyx Pharma and Biophytis go up and down completely randomly.

Pair Corralation between Abionyx Pharma and Biophytis

Assuming the 90 days trading horizon Abionyx Pharma SA is expected to under-perform the Biophytis. But the stock apears to be less risky and, when comparing its historical volatility, Abionyx Pharma SA is 1.56 times less risky than Biophytis. The stock trades about -0.01 of its potential returns per unit of risk. The Biophytis SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  35.00  in Biophytis SA on October 8, 2024 and sell it today you would earn a total of  7.00  from holding Biophytis SA or generate 20.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Abionyx Pharma SA  vs.  Biophytis SA

Abionyx Pharma SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Abionyx Pharma SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Abionyx Pharma is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Biophytis SA

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Biophytis SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Biophytis reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Abionyx Pharma and Biophytis

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

The idea behind Abionyx Pharma SA and Biophytis SA 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.

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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.