Correlation Between Gladstone Investment and Bionoid Pharma

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

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

Diversification Opportunities for Gladstone Investment and Bionoid Pharma

-0.71

Correlation Coefficient

Gladstone Investment  Bionoid Pharma

Pay attention - limited upside

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

Pair Corralation between Gladstone Investment and Bionoid Pharma

Assuming the 90 days horizon Gladstone Investment is expected to generate 0.02 times more return on investment than Bionoid Pharma. However, Gladstone Investment is 41.53 times less risky than Bionoid Pharma. It trades about 0.11 of its potential returns per unit of risk. Bionoid Pharma is currently generating about -0.07 per unit of risk. If you would invest  2,432  in Gladstone Investment on December 21, 2024 and sell it today you would earn a total of  61.00  from holding Gladstone Investment or generate 2.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.77%
Values	Daily Returns

Gladstone Investment  vs.  Bionoid Pharma

Gladstone Investment

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gladstone Investment are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Gladstone Investment is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Bionoid Pharma

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bionoid Pharma has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Gladstone Investment and Bionoid Pharma

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

The idea behind Gladstone Investment and Bionoid Pharma 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.