Correlation Between Monster Beverage and BioAge Labs,

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

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

Diversification Opportunities for Monster Beverage and BioAge Labs,

0.29

Correlation Coefficient

Monster Beverage  BioAge Labs,

Modest diversification

The 3 months correlation between Monster and BioAge is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Monster Beverage Corp and BioAge Labs, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioAge Labs, and Monster Beverage 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 Monster Beverage Corp are associated (or correlated) with BioAge Labs,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioAge Labs, has no effect on the direction of Monster Beverage i.e., Monster Beverage and BioAge Labs, go up and down completely randomly.

Pair Corralation between Monster Beverage and BioAge Labs,

Given the investment horizon of 90 days Monster Beverage Corp is expected to under-perform the BioAge Labs,. But the stock apears to be less risky and, when comparing its historical volatility, Monster Beverage Corp is 9.39 times less risky than BioAge Labs,. The stock trades about -0.06 of its potential returns per unit of risk. The BioAge Labs, is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  480.00  in BioAge Labs, on October 12, 2024 and sell it today you would earn a total of  29.00  from holding BioAge Labs, or generate 6.04% return on investment over 90 days.

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

Monster Beverage Corp  vs.  BioAge Labs,

Monster Beverage Corp

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Monster Beverage Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Monster Beverage is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

BioAge Labs,

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Monster Beverage and BioAge Labs,

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

The idea behind Monster Beverage Corp and BioAge Labs, 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.