Correlation Between Bioatla and Heat Biologics

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

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

Diversification Opportunities for Bioatla and Heat Biologics

0.93
  Correlation Coefficient
Bioatla
Heat Biologics

Almost no diversification

The 3 months correlation between Bioatla and Heat Biologics is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Bioatla and Heat Biologics in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Heat Biologics and Bioatla 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 Bioatla are associated (or correlated) with Heat Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heat Biologics has no effect on the direction of Bioatla i.e., Bioatla and Heat Biologics go up and down completely randomly.

Pair Corralation between Bioatla and Heat Biologics

Given the investment horizon of 90 days Bioatla is expected to under-perform the Heat Biologics. But the stock apears to be less risky and, when comparing its historical volatility, Bioatla is 2.47 times less risky than Heat Biologics. The stock trades about -0.06 of its potential returns per unit of risk. The Heat Biologics is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  168.00  in Heat Biologics on October 19, 2021 and sell it today you would earn a total of  135.00  from holding Heat Biologics or generate 80.36% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy54.91%
ValuesDaily Returns

Bioatla  vs.  Heat Biologics

 Performance (%) 
      Timeline 
Bioatla 
Bioatla Performance
0 of 100
Over the last 90 days Bioatla has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Bioatla Price Channel

Heat Biologics 
Heat Biologics Performance
0 of 100
Over the last 90 days Heat Biologics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in February 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Heat Biologics Price Channel

Bioatla and Heat Biologics Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Bioatla and Heat Biologics

The main advantage of trading using opposite Bioatla and Heat Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bioatla position performs unexpectedly, Heat Biologics 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 Heat Biologics will offset losses from the drop in Heat Biologics' long position.
The idea behind Bioatla and Heat Biologics 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.
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

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