Correlation Between BacTech Environmental and Ecosciences

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

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

Diversification Opportunities for BacTech Environmental and Ecosciences

0.0

Correlation Coefficient

BacTech Environmental  Ecosciences

Pay attention - limited upside

The 3 months correlation between BacTech and Ecosciences is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BacTech Environmental and Ecosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecosciences and BacTech Environmental 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 BacTech Environmental are associated (or correlated) with Ecosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecosciences has no effect on the direction of BacTech Environmental i.e., BacTech Environmental and Ecosciences go up and down completely randomly.

Pair Corralation between BacTech Environmental and Ecosciences

If you would invest  2.13  in BacTech Environmental on September 14, 2024 and sell it today you would earn a total of  0.09  from holding BacTech Environmental or generate 4.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

BacTech Environmental  vs.  Ecosciences

BacTech Environmental

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in BacTech Environmental are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, BacTech Environmental reported solid returns over the last few months and may actually be approaching a breakup point.

Ecosciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ecosciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Ecosciences is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with BacTech Environmental and Ecosciences

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

The idea behind BacTech Environmental and Ecosciences 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.