Correlation Between Bioventus and Axogen

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

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

Diversification Opportunities for Bioventus and Axogen

-0.71

Correlation Coefficient

Bioventus  Axogen

Pay attention - limited upside

The 3 months correlation between Bioventus and Axogen is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bioventus and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and Bioventus 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 Bioventus are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of Bioventus i.e., Bioventus and Axogen go up and down completely randomly.

Pair Corralation between Bioventus and Axogen

Considering the 90-day investment horizon Bioventus is expected to generate 1.21 times more return on investment than Axogen. However, Bioventus is 1.21 times more volatile than Axogen Inc. It trades about 0.1 of its potential returns per unit of risk. Axogen Inc is currently generating about 0.07 per unit of risk. If you would invest  157.00  in Bioventus on December 1, 2024 and sell it today you would earn a total of  857.00  from holding Bioventus or generate 545.86% return on investment over 90 days.

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

Bioventus  vs.  Axogen Inc

Bioventus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bioventus has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Axogen Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Axogen Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting technical and fundamental indicators, Axogen displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bioventus and Axogen

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

The idea behind Bioventus and Axogen Inc 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.