Correlation Between Trinity Biotech and Exagen

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

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

Diversification Opportunities for Trinity Biotech and Exagen

0.17

Correlation Coefficient

Trinity Biotech  Exagen

Average diversification

The 3 months correlation between Trinity and Exagen is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Trinity Biotech plc and Exagen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exagen Inc and Trinity Biotech 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 Trinity Biotech plc are associated (or correlated) with Exagen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exagen Inc has no effect on the direction of Trinity Biotech i.e., Trinity Biotech and Exagen go up and down completely randomly.

Pair Corralation between Trinity Biotech and Exagen

Given the investment horizon of 90 days Trinity Biotech plc is expected to under-perform the Exagen. In addition to that, Trinity Biotech is 1.41 times more volatile than Exagen Inc. It trades about 0.0 of its total potential returns per unit of risk. Exagen Inc is currently generating about 0.02 per unit of volatility. If you would invest  428.00  in Exagen Inc on December 29, 2024 and sell it today you would lose (44.00) from holding Exagen Inc or give up 10.28% of portfolio value over 90 days.

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

Trinity Biotech plc  vs.  Exagen Inc

Trinity Biotech plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Trinity Biotech plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Trinity Biotech is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Exagen Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Exagen Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Exagen may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Trinity Biotech and Exagen

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

The idea behind Trinity Biotech plc and Exagen 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.