Correlation Between BioatlaInc and Brooklyn Immunotherapeuti

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

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

Diversification Opportunities for BioatlaInc and Brooklyn Immunotherapeuti

-0.68

Correlation Coefficient

BioatlaInc  Brooklyn Immunotherapeuti

Excellent diversification

The 3 months correlation between BioatlaInc and Brooklyn is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding BioatlaInc and Brooklyn Immunotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brooklyn Immunotherapeuti and BioatlaInc 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 BioatlaInc are associated (or correlated) with Brooklyn Immunotherapeuti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brooklyn Immunotherapeuti has no effect on the direction of BioatlaInc i.e., BioatlaInc and Brooklyn Immunotherapeuti go up and down completely randomly.

Pair Corralation between BioatlaInc and Brooklyn Immunotherapeuti

If you would invest  246.00  in BioatlaInc on January 19, 2024 and sell it today you would earn a total of  7.00  from holding BioatlaInc or generate 2.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	4.55%
Values	Daily Returns

BioatlaInc  vs.  Brooklyn Immunotherapeutics

BioatlaInc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BioatlaInc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, BioatlaInc sustained solid returns over the last few months and may actually be approaching a breakup point.

Brooklyn Immunotherapeuti

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brooklyn Immunotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Brooklyn Immunotherapeuti is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with BioatlaInc and Brooklyn Immunotherapeuti

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

The idea behind BioatlaInc and Brooklyn Immunotherapeutics 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.