Correlation Between Biofrontera Warrants and Nutriband

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Can any of the company-specific risk be diversified away by investing in both Biofrontera Warrants and Nutriband 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 Biofrontera Warrants and Nutriband into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biofrontera Warrants and Nutriband, you can compare the effects of market volatilities on Biofrontera Warrants and Nutriband 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 Biofrontera Warrants with a short position of Nutriband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biofrontera Warrants and Nutriband.

Diversification Opportunities for Biofrontera Warrants and Nutriband

-0.7
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Biofrontera and Nutriband is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Biofrontera Warrants and Nutriband in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nutriband and Biofrontera Warrants 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 Biofrontera Warrants are associated (or correlated) with Nutriband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nutriband has no effect on the direction of Biofrontera Warrants i.e., Biofrontera Warrants and Nutriband go up and down completely randomly.

Pair Corralation between Biofrontera Warrants and Nutriband

Assuming the 90 days horizon Biofrontera Warrants is expected to generate 10.57 times more return on investment than Nutriband. However, Biofrontera Warrants is 10.57 times more volatile than Nutriband. It trades about 0.18 of its potential returns per unit of risk. Nutriband is currently generating about -0.03 per unit of risk. If you would invest  2.50  in Biofrontera Warrants on October 3, 2024 and sell it today you would earn a total of  6.87  from holding Biofrontera Warrants or generate 274.8% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy85.48%
ValuesDaily Returns

Biofrontera Warrants  vs.  Nutriband

 Performance 
       Timeline  
Biofrontera Warrants 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Biofrontera Warrants are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent forward indicators, Biofrontera Warrants showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec20250.0249999999999999720.050.10.150.2
Nutriband 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Nutriband has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
JavaScript chart by amCharts 3.21.15NovDecDec45678

Biofrontera Warrants and Nutriband Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Biofrontera Warrants and Nutriband

The main advantage of trading using opposite Biofrontera Warrants and Nutriband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biofrontera Warrants position performs unexpectedly, Nutriband 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 Nutriband will offset losses from the drop in Nutriband's long position.
The idea behind Biofrontera Warrants and Nutriband 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.

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