Correlation Between Biovie and Ping An

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

By analyzing existing cross correlation between Biovie Inc and Ping An Insurance, you can compare the effects of market volatilities on Biovie and Ping An 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 Biovie with a short position of Ping An. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biovie and Ping An.

Diversification Opportunities for Biovie and Ping An

-0.7

Correlation Coefficient

Biovie  Ping An

Excellent diversification

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

Pair Corralation between Biovie and Ping An

Given the investment horizon of 90 days Biovie Inc is expected to under-perform the Ping An. In addition to that, Biovie is 1.96 times more volatile than Ping An Insurance. It trades about -0.19 of its total potential returns per unit of risk. Ping An Insurance is currently generating about 0.09 per unit of volatility. If you would invest  545.00  in Ping An Insurance on December 28, 2024 and sell it today you would earn a total of  65.00  from holding Ping An Insurance or generate 11.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	93.33%
Values	Daily Returns

Biovie Inc  vs.  Ping An Insurance

Biovie Inc

Risk-Adjusted Performance

Very Weak

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

Ping An Insurance

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ping An Insurance are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward indicators, Ping An reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Biovie and Ping An

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

The idea behind Biovie Inc and Ping An Insurance 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..