Correlation Between B Yair and BioLight Life

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

By analyzing existing cross correlation between B Yair Building and BioLight Life Sciences, you can compare the effects of market volatilities on B Yair and BioLight Life 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 B Yair with a short position of BioLight Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Yair and BioLight Life.

Diversification Opportunities for B Yair and BioLight Life

-0.07

Correlation Coefficient

B Yair  BioLight Life

Good diversification

The 3 months correlation between BYAR and BioLight is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding B Yair Building and BioLight Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioLight Life Sciences and B Yair 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 B Yair Building are associated (or correlated) with BioLight Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioLight Life Sciences has no effect on the direction of B Yair i.e., B Yair and BioLight Life go up and down completely randomly.

Pair Corralation between B Yair and BioLight Life

Assuming the 90 days trading horizon B Yair Building is expected to under-perform the BioLight Life. In addition to that, B Yair is 1.92 times more volatile than BioLight Life Sciences. It trades about -0.06 of its total potential returns per unit of risk. BioLight Life Sciences is currently generating about 0.17 per unit of volatility. If you would invest  54,000  in BioLight Life Sciences on December 30, 2024 and sell it today you would earn a total of  13,100  from holding BioLight Life Sciences or generate 24.26% return on investment over 90 days.

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

B Yair Building  vs.  BioLight Life Sciences

B Yair Building

Risk-Adjusted Performance

Very Weak

Over the last 90 days B Yair Building 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 somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

BioLight Life Sciences

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BioLight Life Sciences are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, BioLight Life sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with B Yair and BioLight Life

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

The idea behind B Yair Building and BioLight Life Sciences 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.

Check out your portfolio center.

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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.