Correlation Between Biotech Growth and FS Credit
Can any of the company-specific risk be diversified away by investing in both Biotech Growth and FS Credit 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 Biotech Growth and FS Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Biotech Growth and FS Credit Opportunities, you can compare the effects of market volatilities on Biotech Growth and FS Credit 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 Biotech Growth with a short position of FS Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biotech Growth and FS Credit.
Diversification Opportunities for Biotech Growth and FS Credit
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Biotech and FSCO is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding The Biotech Growth and FS Credit Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FS Credit Opportunities and Biotech Growth 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 The Biotech Growth are associated (or correlated) with FS Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FS Credit Opportunities has no effect on the direction of Biotech Growth i.e., Biotech Growth and FS Credit go up and down completely randomly.
Pair Corralation between Biotech Growth and FS Credit
Assuming the 90 days trading horizon The Biotech Growth is expected to generate 0.96 times more return on investment than FS Credit. However, The Biotech Growth is 1.05 times less risky than FS Credit. It trades about 0.31 of its potential returns per unit of risk. FS Credit Opportunities is currently generating about -0.12 per unit of risk. If you would invest 91,000 in The Biotech Growth on September 3, 2025 and sell it today you would earn a total of 35,000 from holding The Biotech Growth or generate 38.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
The Biotech Growth vs. FS Credit Opportunities
Performance |
| Timeline |
| Biotech Growth |
| FS Credit Opportunities |
Biotech Growth and FS Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biotech Growth and FS Credit
The main advantage of trading using opposite Biotech Growth and FS Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biotech Growth position performs unexpectedly, FS Credit 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 FS Credit will offset losses from the drop in FS Credit's long position.| Biotech Growth vs. Check Point Software | Biotech Growth vs. SMA Solar Technology | Biotech Growth vs. JLEN Environmental Assets | Biotech Growth vs. Zanaga Iron Ore |
| FS Credit vs. China Industrial Waste | FS Credit vs. Waste Management | FS Credit vs. Sulliden Mining Capital | FS Credit vs. Kingsrose Mining Limited |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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