Correlation Between Biotron and UCB SA
Can any of the company-specific risk be diversified away by investing in both Biotron and UCB SA 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 Biotron and UCB SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biotron Limited and UCB SA ADR, you can compare the effects of market volatilities on Biotron and UCB SA 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 Biotron with a short position of UCB SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biotron and UCB SA.
Diversification Opportunities for Biotron and UCB SA
Very good diversification
The 3 months correlation between Biotron and UCB is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Biotron Limited and UCB SA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UCB SA ADR and Biotron 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 Biotron Limited are associated (or correlated) with UCB SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UCB SA ADR has no effect on the direction of Biotron i.e., Biotron and UCB SA go up and down completely randomly.
Pair Corralation between Biotron and UCB SA
Assuming the 90 days horizon Biotron Limited is expected to generate 4.13 times more return on investment than UCB SA. However, Biotron is 4.13 times more volatile than UCB SA ADR. It trades about 0.22 of its potential returns per unit of risk. UCB SA ADR is currently generating about 0.19 per unit of risk. If you would invest 4.88 in Biotron Limited on January 25, 2024 and sell it today you would earn a total of 0.97 from holding Biotron Limited or generate 19.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Biotron Limited vs. UCB SA ADR
Performance |
| Timeline |
| Biotron Limited |
| UCB SA ADR |
Biotron and UCB SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biotron and UCB SA
The main advantage of trading using opposite Biotron and UCB SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biotron position performs unexpectedly, UCB SA 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 UCB SA will offset losses from the drop in UCB SA's long position.| Biotron vs. Mymetics Corp | Biotron vs. Nascent Biotech | Biotron vs. HUMANA INC | Biotron vs. Aquagold International |
| UCB SA vs. Tonix Pharmaceuticals Holding | UCB SA vs. NextCure | UCB SA vs. CytomX Therapeutics | UCB SA vs. Spero Therapeutics |
Check out your portfolio center.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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |