Correlation Between Biodexa Pharmaceticals and BWV

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

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

Diversification Opportunities for Biodexa Pharmaceticals and BWV

0.0

Correlation Coefficient

Biodexa Pharmaceticals  BWV

Pay attention - limited upside

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

Pair Corralation between Biodexa Pharmaceticals and BWV

If you would invest (100.00) in BWV on November 29, 2024 and sell it today you would earn a total of  100.00  from holding BWV or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Biodexa Pharmaceticals  vs.  BWV

Biodexa Pharmaceticals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Biodexa Pharmaceticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

BWV

Risk-Adjusted Performance

Very Weak

Over the last 90 days BWV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, BWV is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Biodexa Pharmaceticals and BWV

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

The idea behind Biodexa Pharmaceticals and BWV 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.