Correlation Between EGF Theramed and Biotron
Can any of the company-specific risk be diversified away by investing in both EGF Theramed and Biotron 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 EGF Theramed and Biotron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EGF Theramed Health and Biotron Limited, you can compare the effects of market volatilities on EGF Theramed and Biotron 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 EGF Theramed with a short position of Biotron. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGF Theramed and Biotron.
Diversification Opportunities for EGF Theramed and Biotron
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between EGF and Biotron is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding EGF Theramed Health and Biotron Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biotron Limited and EGF Theramed 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 EGF Theramed Health are associated (or correlated) with Biotron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biotron Limited has no effect on the direction of EGF Theramed i.e., EGF Theramed and Biotron go up and down completely randomly.
Pair Corralation between EGF Theramed and Biotron
Assuming the 90 days horizon EGF Theramed Health is expected to under-perform the Biotron. But the pink sheet apears to be less risky and, when comparing its historical volatility, EGF Theramed Health is 21.31 times less risky than Biotron. The pink sheet trades about -0.08 of its potential returns per unit of risk. The Biotron Limited is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1.30 in Biotron Limited on August 28, 2025 and sell it today you would lose (1.18) from holding Biotron Limited or give up 90.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.92% |
| Values | Daily Returns |
EGF Theramed Health vs. Biotron Limited
Performance |
| Timeline |
| EGF Theramed Health |
| Biotron Limited |
EGF Theramed and Biotron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGF Theramed and Biotron
The main advantage of trading using opposite EGF Theramed and Biotron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGF Theramed position performs unexpectedly, Biotron 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 Biotron will offset losses from the drop in Biotron's long position.| EGF Theramed vs. New Ulm Telecom | EGF Theramed vs. Paiute Oil Mining | EGF Theramed vs. Hunter Creek Mining | EGF Theramed vs. B Communications |
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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 Stocks Directory module to find actively traded stocks across global markets.
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