Correlation Between Biomerica and SINTX Technologies

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

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

Diversification Opportunities for Biomerica and SINTX Technologies

-0.25

Correlation Coefficient

Biomerica  SINTX Technologies

Very good diversification

The 3 months correlation between Biomerica and SINTX is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Biomerica and SINTX Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINTX Technologies and Biomerica 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 Biomerica are associated (or correlated) with SINTX Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINTX Technologies has no effect on the direction of Biomerica i.e., Biomerica and SINTX Technologies go up and down completely randomly.

Pair Corralation between Biomerica and SINTX Technologies

Given the investment horizon of 90 days Biomerica is expected to under-perform the SINTX Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Biomerica is 1.12 times less risky than SINTX Technologies. The stock trades about -0.1 of its potential returns per unit of risk. The SINTX Technologies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  347.00  in SINTX Technologies on October 5, 2024 and sell it today you would earn a total of  3.00  from holding SINTX Technologies or generate 0.86% return on investment over 90 days.

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

Biomerica  vs.  SINTX Technologies

Biomerica

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Biomerica are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Biomerica may actually be approaching a critical reversion point that can send shares even higher in February 2025.

SINTX Technologies

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SINTX Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SINTX Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Biomerica and SINTX Technologies

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

The idea behind Biomerica and SINTX Technologies 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.