Correlation Between ResMed and Bionano Genomics
Can any of the company-specific risk be diversified away by investing in both ResMed and Bionano Genomics 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 ResMed and Bionano Genomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ResMed Inc and Bionano Genomics, you can compare the effects of market volatilities on ResMed and Bionano Genomics 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 ResMed with a short position of Bionano Genomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ResMed and Bionano Genomics.
Diversification Opportunities for ResMed and Bionano Genomics
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ResMed and Bionano is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding ResMed Inc and Bionano Genomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bionano Genomics and ResMed 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 ResMed Inc are associated (or correlated) with Bionano Genomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bionano Genomics has no effect on the direction of ResMed i.e., ResMed and Bionano Genomics go up and down completely randomly.
Pair Corralation between ResMed and Bionano Genomics
Considering the 90-day investment horizon ResMed Inc is expected to generate 0.93 times more return on investment than Bionano Genomics. However, ResMed Inc is 1.08 times less risky than Bionano Genomics. It trades about 0.18 of its potential returns per unit of risk. Bionano Genomics is currently generating about -0.02 per unit of risk. If you would invest 18,436 in ResMed Inc on February 2, 2024 and sell it today you would earn a total of 3,065 from holding ResMed Inc or generate 16.63% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ResMed Inc vs. Bionano Genomics
Performance |
Timeline |
ResMed Inc |
Bionano Genomics |
ResMed and Bionano Genomics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ResMed and Bionano Genomics
The main advantage of trading using opposite ResMed and Bionano Genomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ResMed position performs unexpectedly, Bionano Genomics 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 Bionano Genomics will offset losses from the drop in Bionano Genomics' long position.ResMed vs. Pfizer Inc | ResMed vs. LSI Industries | ResMed vs. Bull Profund Investor | ResMed vs. Thornburg Limited Term |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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