Correlation Between Xvivo Perfusion and Biotage AB

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

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

Diversification Opportunities for Xvivo Perfusion and Biotage AB

0.85

Correlation Coefficient

Xvivo Perfusion  Biotage AB

Very poor diversification

The 3 months correlation between Xvivo and Biotage is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Xvivo Perfusion AB and Biotage AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biotage AB and Xvivo Perfusion 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 Xvivo Perfusion AB are associated (or correlated) with Biotage AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biotage AB has no effect on the direction of Xvivo Perfusion i.e., Xvivo Perfusion and Biotage AB go up and down completely randomly.

Pair Corralation between Xvivo Perfusion and Biotage AB

Assuming the 90 days trading horizon Xvivo Perfusion AB is expected to generate 1.1 times more return on investment than Biotage AB. However, Xvivo Perfusion is 1.1 times more volatile than Biotage AB. It trades about 0.08 of its potential returns per unit of risk. Biotage AB is currently generating about 0.01 per unit of risk. If you would invest  18,520  in Xvivo Perfusion AB on September 24, 2024 and sell it today you would earn a total of  28,130  from holding Xvivo Perfusion AB or generate 151.89% return on investment over 90 days.

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

Xvivo Perfusion AB  vs.  Biotage AB

Xvivo Perfusion AB

Risk-Adjusted Performance

0 of 100

Very Weak

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

Biotage AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Biotage AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Xvivo Perfusion and Biotage AB

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

The idea behind Xvivo Perfusion AB and Biotage AB 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 Global Correlations module to find global opportunities by holding instruments from different markets.