Correlation Between Bergenbio ASA and PCI Biotech

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

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

Diversification Opportunities for Bergenbio ASA and PCI Biotech

-0.16

Correlation Coefficient

Bergenbio ASA  PCI Biotech

Good diversification

The 3 months correlation between Bergenbio and PCI is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bergenbio ASA and PCI Biotech Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCI Biotech Holding and Bergenbio ASA 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 Bergenbio ASA are associated (or correlated) with PCI Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCI Biotech Holding has no effect on the direction of Bergenbio ASA i.e., Bergenbio ASA and PCI Biotech go up and down completely randomly.

Pair Corralation between Bergenbio ASA and PCI Biotech

Assuming the 90 days trading horizon Bergenbio ASA is expected to under-perform the PCI Biotech. In addition to that, Bergenbio ASA is 2.11 times more volatile than PCI Biotech Holding. It trades about -0.1 of its total potential returns per unit of risk. PCI Biotech Holding is currently generating about 0.03 per unit of volatility. If you would invest  136.00  in PCI Biotech Holding on December 31, 2024 and sell it today you would earn a total of  2.00  from holding PCI Biotech Holding or generate 1.47% return on investment over 90 days.

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

Bergenbio ASA  vs.  PCI Biotech Holding

Bergenbio ASA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bergenbio ASA 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 very healthy which may send shares a bit higher in May 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

PCI Biotech Holding

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PCI Biotech Holding are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, PCI Biotech may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Pair Trading with Bergenbio ASA and PCI Biotech

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

The idea behind Bergenbio ASA and PCI Biotech Holding 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.

Check out your portfolio center.

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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.