Correlation Between Bolt Biotherapeutics and Zivo Bioscience

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

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

Diversification Opportunities for Bolt Biotherapeutics and Zivo Bioscience

0.43

Correlation Coefficient

Bolt Biotherapeutics  Zivo Bioscience

Very weak diversification

The 3 months correlation between Bolt and Zivo is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Bolt Biotherapeutics and Zivo Bioscience in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zivo Bioscience and Bolt Biotherapeutics 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 Bolt Biotherapeutics are associated (or correlated) with Zivo Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zivo Bioscience has no effect on the direction of Bolt Biotherapeutics i.e., Bolt Biotherapeutics and Zivo Bioscience go up and down completely randomly.

Pair Corralation between Bolt Biotherapeutics and Zivo Bioscience

Given the investment horizon of 90 days Bolt Biotherapeutics is expected to generate 0.8 times more return on investment than Zivo Bioscience. However, Bolt Biotherapeutics is 1.25 times less risky than Zivo Bioscience. It trades about -0.03 of its potential returns per unit of risk. Zivo Bioscience is currently generating about -0.04 per unit of risk. If you would invest  130.00  in Bolt Biotherapeutics on September 13, 2024 and sell it today you would lose (77.00) from holding Bolt Biotherapeutics or give up 59.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	29.29%
Values	Daily Returns

Bolt Biotherapeutics  vs.  Zivo Bioscience

Bolt Biotherapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bolt Biotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's essential indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Zivo Bioscience

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zivo Bioscience has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Zivo Bioscience is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Bolt Biotherapeutics and Zivo Bioscience

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

The idea behind Bolt Biotherapeutics and Zivo Bioscience 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.