Correlation Between Bactiguard Holding and BioInvent International

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

By analyzing existing cross correlation between Bactiguard Holding AB and BioInvent International AB, you can compare the effects of market volatilities on Bactiguard Holding and BioInvent International 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 Bactiguard Holding with a short position of BioInvent International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bactiguard Holding and BioInvent International.

Diversification Opportunities for Bactiguard Holding and BioInvent International

0.54

Correlation Coefficient

Bactiguard Holding  BioInvent International

Very weak diversification

The 3 months correlation between Bactiguard and BioInvent is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Bactiguard Holding AB and BioInvent International AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioInvent International and Bactiguard Holding 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 Bactiguard Holding AB are associated (or correlated) with BioInvent International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioInvent International has no effect on the direction of Bactiguard Holding i.e., Bactiguard Holding and BioInvent International go up and down completely randomly.

Pair Corralation between Bactiguard Holding and BioInvent International

Assuming the 90 days trading horizon Bactiguard Holding AB is expected to generate 1.42 times more return on investment than BioInvent International. However, Bactiguard Holding is 1.42 times more volatile than BioInvent International AB. It trades about 0.0 of its potential returns per unit of risk. BioInvent International AB is currently generating about -0.3 per unit of risk. If you would invest  3,700  in Bactiguard Holding AB on November 29, 2024 and sell it today you would lose (220.00) from holding Bactiguard Holding AB or give up 5.95% of portfolio value over 90 days.

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

Bactiguard Holding AB  vs.  BioInvent International AB

Bactiguard Holding

Risk-Adjusted Performance

Weak

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

BioInvent International

Risk-Adjusted Performance

Very Weak

Over the last 90 days BioInvent International AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Bactiguard Holding and BioInvent International

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

The idea behind Bactiguard Holding AB and BioInvent International AB 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.