Correlation Between Bionano Genomics and Predictive Oncology

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

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

Diversification Opportunities for Bionano Genomics and Predictive Oncology

0.43

Correlation Coefficient

Bionano Genomics  Predictive Oncology

Very weak diversification

The 3 months correlation between Bionano and Predictive is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Bionano Genomics and Predictive Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Predictive Oncology and Bionano Genomics 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 Bionano Genomics are associated (or correlated) with Predictive Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Predictive Oncology has no effect on the direction of Bionano Genomics i.e., Bionano Genomics and Predictive Oncology go up and down completely randomly.

Pair Corralation between Bionano Genomics and Predictive Oncology

Given the investment horizon of 90 days Bionano Genomics is expected to under-perform the Predictive Oncology. But the stock apears to be less risky and, when comparing its historical volatility, Bionano Genomics is 1.58 times less risky than Predictive Oncology. The stock trades about -0.14 of its potential returns per unit of risk. The Predictive Oncology is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  806.00  in Predictive Oncology on September 5, 2024 and sell it today you would lose (724.00) from holding Predictive Oncology or give up 89.83% of portfolio value over 90 days.

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

Bionano Genomics  vs.  Predictive Oncology

Bionano Genomics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bionano Genomics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Predictive Oncology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Predictive Oncology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Predictive Oncology is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Bionano Genomics and Predictive Oncology

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

The idea behind Bionano Genomics and Predictive Oncology 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.