Correlation Between Helix BioPharma and Microbix Biosystems

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

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

Diversification Opportunities for Helix BioPharma and Microbix Biosystems

0.14

Correlation Coefficient

Helix BioPharma  Microbix Biosystems

Average diversification

The 3 months correlation between Helix and Microbix is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Helix BioPharma Corp and Microbix Biosystems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbix Biosystems and Helix BioPharma 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 Helix BioPharma Corp are associated (or correlated) with Microbix Biosystems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbix Biosystems has no effect on the direction of Helix BioPharma i.e., Helix BioPharma and Microbix Biosystems go up and down completely randomly.

Pair Corralation between Helix BioPharma and Microbix Biosystems

Assuming the 90 days trading horizon Helix BioPharma is expected to generate 3.92 times less return on investment than Microbix Biosystems. In addition to that, Helix BioPharma is 1.19 times more volatile than Microbix Biosystems. It trades about 0.03 of its total potential returns per unit of risk. Microbix Biosystems is currently generating about 0.16 per unit of volatility. If you would invest  30.00  in Microbix Biosystems on December 2, 2024 and sell it today you would earn a total of  14.00  from holding Microbix Biosystems or generate 46.67% return on investment over 90 days.

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

Helix BioPharma Corp  vs.  Microbix Biosystems

Helix BioPharma Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Helix BioPharma Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Helix BioPharma may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Microbix Biosystems

Risk-Adjusted Performance

Good

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

Pair Trading with Helix BioPharma and Microbix Biosystems

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

The idea behind Helix BioPharma Corp and Microbix Biosystems 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.