Correlation Between Bit Origin and BioForce Nanosciences

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

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

Diversification Opportunities for Bit Origin and BioForce Nanosciences

0.64

Correlation Coefficient

Bit Origin  BioForce Nanosciences

Poor diversification

The 3 months correlation between Bit and BioForce is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Bit Origin and BioForce Nanosciences Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioForce Nanosciences and Bit Origin 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 Bit Origin are associated (or correlated) with BioForce Nanosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioForce Nanosciences has no effect on the direction of Bit Origin i.e., Bit Origin and BioForce Nanosciences go up and down completely randomly.

Pair Corralation between Bit Origin and BioForce Nanosciences

Given the investment horizon of 90 days Bit Origin is expected to generate 0.53 times more return on investment than BioForce Nanosciences. However, Bit Origin is 1.9 times less risky than BioForce Nanosciences. It trades about -0.19 of its potential returns per unit of risk. BioForce Nanosciences Holdings is currently generating about -0.33 per unit of risk. If you would invest  136.00  in Bit Origin on October 3, 2024 and sell it today you would lose (38.00) from holding Bit Origin or give up 27.94% of portfolio value over 90 days.

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

Bit Origin  vs.  BioForce Nanosciences Holdings

Bit Origin

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bit Origin 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 nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

BioForce Nanosciences

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Bit Origin and BioForce Nanosciences

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

The idea behind Bit Origin and BioForce Nanosciences Holdings 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.