Correlation Between YS Biopharma and BiocardiaInc

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

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

Diversification Opportunities for YS Biopharma and BiocardiaInc

-0.75

Correlation Coefficient

YS Biopharma  BiocardiaInc

Pay attention - limited upside

The 3 months correlation between YS Biopharma and BiocardiaInc is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding YS Biopharma Co and BiocardiaInc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BiocardiaInc and YS Biopharma 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 YS Biopharma Co are associated (or correlated) with BiocardiaInc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BiocardiaInc has no effect on the direction of YS Biopharma i.e., YS Biopharma and BiocardiaInc go up and down completely randomly.

Pair Corralation between YS Biopharma and BiocardiaInc

Allowing for the 90-day total investment horizon YS Biopharma Co is expected to generate 1.12 times more return on investment than BiocardiaInc. However, YS Biopharma is 1.12 times more volatile than BiocardiaInc. It trades about 0.28 of its potential returns per unit of risk. BiocardiaInc is currently generating about -0.04 per unit of risk. If you would invest  75.00  in YS Biopharma Co on March 2, 2024 and sell it today you would earn a total of  27.00  from holding YS Biopharma Co or generate 36.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	90.48%
Values	Daily Returns

YS Biopharma Co  vs.  BiocardiaInc

YS Biopharma

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in YS Biopharma Co are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, YS Biopharma unveiled solid returns over the last few months and may actually be approaching a breakup point.

BiocardiaInc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BiocardiaInc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in July 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with YS Biopharma and BiocardiaInc

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

The idea behind YS Biopharma Co and BiocardiaInc 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.