Correlation Between Burning Rock and Interpace Biosciences

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

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

Diversification Opportunities for Burning Rock and Interpace Biosciences

0.0

Correlation Coefficient

Burning Rock  Interpace Biosciences

Pay attention - limited upside

The 3 months correlation between Burning and Interpace is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Burning Rock Biotech and Interpace Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interpace Biosciences and Burning Rock 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 Burning Rock Biotech are associated (or correlated) with Interpace Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interpace Biosciences has no effect on the direction of Burning Rock i.e., Burning Rock and Interpace Biosciences go up and down completely randomly.

Pair Corralation between Burning Rock and Interpace Biosciences

If you would invest (100.00) in Interpace Biosciences on November 28, 2024 and sell it today you would earn a total of  100.00  from holding Interpace Biosciences or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Burning Rock Biotech  vs.  Interpace Biosciences

Burning Rock Biotech

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Burning Rock Biotech are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Burning Rock may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Interpace Biosciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Interpace Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Interpace Biosciences is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Burning Rock and Interpace Biosciences

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

The idea behind Burning Rock Biotech and Interpace Biosciences 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.