Correlation Between BioForce Nanosciences and SunOpta

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

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

Diversification Opportunities for BioForce Nanosciences and SunOpta

-0.42

Correlation Coefficient

BioForce Nanosciences  SunOpta

Very good diversification

The 3 months correlation between BioForce and SunOpta is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding BioForce Nanosciences Holdings and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and BioForce Nanosciences 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 BioForce Nanosciences Holdings are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of BioForce Nanosciences i.e., BioForce Nanosciences and SunOpta go up and down completely randomly.

Pair Corralation between BioForce Nanosciences and SunOpta

Given the investment horizon of 90 days BioForce Nanosciences Holdings is expected to under-perform the SunOpta. In addition to that, BioForce Nanosciences is 5.51 times more volatile than SunOpta. It trades about -0.33 of its total potential returns per unit of risk. SunOpta is currently generating about 0.03 per unit of volatility. If you would invest  775.00  in SunOpta on September 30, 2024 and sell it today you would earn a total of  6.00  from holding SunOpta or generate 0.77% return on investment over 90 days.

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

BioForce Nanosciences Holdings  vs.  SunOpta

BioForce Nanosciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BioForce Nanosciences Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

SunOpta

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SunOpta are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward-looking signals, SunOpta disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BioForce Nanosciences and SunOpta

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

The idea behind BioForce Nanosciences Holdings and SunOpta 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.