Correlation Between Bioceres Crop and Sky Harbour

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

By analyzing existing cross correlation between Bioceres Crop Solutions and Sky Harbour Group, you can compare the effects of market volatilities on Bioceres Crop and Sky Harbour 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 Bioceres Crop with a short position of Sky Harbour. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bioceres Crop and Sky Harbour.

Diversification Opportunities for Bioceres Crop and Sky Harbour

0.22

Correlation Coefficient

Bioceres Crop  Sky Harbour

Modest diversification

The 3 months correlation between Bioceres and Sky is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Bioceres Crop Solutions and Sky Harbour Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sky Harbour Group and Bioceres Crop 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 Bioceres Crop Solutions are associated (or correlated) with Sky Harbour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sky Harbour Group has no effect on the direction of Bioceres Crop i.e., Bioceres Crop and Sky Harbour go up and down completely randomly.

Pair Corralation between Bioceres Crop and Sky Harbour

Given the investment horizon of 90 days Bioceres Crop Solutions is expected to under-perform the Sky Harbour. But the stock apears to be less risky and, when comparing its historical volatility, Bioceres Crop Solutions is 2.02 times less risky than Sky Harbour. The stock trades about -0.04 of its potential returns per unit of risk. The Sky Harbour Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  265.00  in Sky Harbour Group on September 15, 2024 and sell it today you would earn a total of  1,104  from holding Sky Harbour Group or generate 416.6% return on investment over 90 days.

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

Bioceres Crop Solutions  vs.  Sky Harbour Group

Bioceres Crop Solutions

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bioceres Crop Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent 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 current disturbance may also be a sign of long term up-swing for the company investors.

Sky Harbour Group

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sky Harbour Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Sky Harbour may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Bioceres Crop and Sky Harbour

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

The idea behind Bioceres Crop Solutions and Sky Harbour Group 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.