Correlation Between Biofil Chemicals and LLOYDS METALS

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

By analyzing existing cross correlation between Biofil Chemicals Pharmaceuticals and LLOYDS METALS AND, you can compare the effects of market volatilities on Biofil Chemicals and LLOYDS METALS 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 Biofil Chemicals with a short position of LLOYDS METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biofil Chemicals and LLOYDS METALS.

Diversification Opportunities for Biofil Chemicals and LLOYDS METALS

-0.44

Correlation Coefficient

Biofil Chemicals  LLOYDS METALS

Very good diversification

The 3 months correlation between Biofil and LLOYDS is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Biofil Chemicals Pharmaceutica and LLOYDS METALS AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LLOYDS METALS AND and Biofil Chemicals 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 Biofil Chemicals Pharmaceuticals are associated (or correlated) with LLOYDS METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LLOYDS METALS AND has no effect on the direction of Biofil Chemicals i.e., Biofil Chemicals and LLOYDS METALS go up and down completely randomly.

Pair Corralation between Biofil Chemicals and LLOYDS METALS

Assuming the 90 days trading horizon Biofil Chemicals Pharmaceuticals is expected to under-perform the LLOYDS METALS. In addition to that, Biofil Chemicals is 1.15 times more volatile than LLOYDS METALS AND. It trades about -0.12 of its total potential returns per unit of risk. LLOYDS METALS AND is currently generating about 0.4 per unit of volatility. If you would invest  112,530  in LLOYDS METALS AND on October 11, 2024 and sell it today you would earn a total of  30,200  from holding LLOYDS METALS AND or generate 26.84% return on investment over 90 days.

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

Biofil Chemicals Pharmaceutica  vs.  LLOYDS METALS AND

Biofil Chemicals Pha

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Biofil Chemicals Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

LLOYDS METALS AND

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in LLOYDS METALS AND are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, LLOYDS METALS displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Biofil Chemicals and LLOYDS METALS

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

The idea behind Biofil Chemicals Pharmaceuticals and LLOYDS METALS AND 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.