Correlation Between Bio-Techne Corp and ADDUS HOMECARE

Can any of the company-specific risk be diversified away by investing in both Bio-Techne Corp and ADDUS HOMECARE 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 Bio-Techne Corp and ADDUS HOMECARE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bio Techne Corp and ADDUS HOMECARE, you can compare the effects of market volatilities on Bio-Techne Corp and ADDUS HOMECARE 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 Bio-Techne Corp with a short position of ADDUS HOMECARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bio-Techne Corp and ADDUS HOMECARE.

Diversification Opportunities for Bio-Techne Corp and ADDUS HOMECARE

-0.17

Correlation Coefficient

Bio-Techne Corp  ADDUS HOMECARE

Good diversification

The 3 months correlation between Bio-Techne and ADDUS is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bio Techne Corp and ADDUS HOMECARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADDUS HOMECARE and Bio-Techne Corp 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 Bio Techne Corp are associated (or correlated) with ADDUS HOMECARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADDUS HOMECARE has no effect on the direction of Bio-Techne Corp i.e., Bio-Techne Corp and ADDUS HOMECARE go up and down completely randomly.

Pair Corralation between Bio-Techne Corp and ADDUS HOMECARE

Assuming the 90 days trading horizon Bio-Techne Corp is expected to generate 1.91 times less return on investment than ADDUS HOMECARE. In addition to that, Bio-Techne Corp is 1.49 times more volatile than ADDUS HOMECARE. It trades about 0.02 of its total potential returns per unit of risk. ADDUS HOMECARE is currently generating about 0.07 per unit of volatility. If you would invest  8,700  in ADDUS HOMECARE on April 24, 2025 and sell it today you would earn a total of  550.00  from holding ADDUS HOMECARE or generate 6.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Bio Techne Corp  vs.  ADDUS HOMECARE

Bio Techne Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bio Techne Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Bio-Techne Corp is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

ADDUS HOMECARE

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ADDUS HOMECARE are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, ADDUS HOMECARE may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Bio-Techne Corp and ADDUS HOMECARE

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

The idea behind Bio Techne Corp and ADDUS HOMECARE 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 the My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.