Correlation Between Helix BioPharma and Premium Income

Can any of the company-specific risk be diversified away by investing in both Helix BioPharma and Premium Income 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 Helix BioPharma and Premium Income into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Helix BioPharma Corp and Premium Income, you can compare the effects of market volatilities on Helix BioPharma and Premium Income 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 Helix BioPharma with a short position of Premium Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helix BioPharma and Premium Income.

Diversification Opportunities for Helix BioPharma and Premium Income

0.01

Correlation Coefficient

Helix BioPharma  Premium Income

Significant diversification

The 3 months correlation between Helix and Premium is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Helix BioPharma Corp and Premium Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premium Income and Helix BioPharma 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 Helix BioPharma Corp are associated (or correlated) with Premium Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premium Income has no effect on the direction of Helix BioPharma i.e., Helix BioPharma and Premium Income go up and down completely randomly.

Pair Corralation between Helix BioPharma and Premium Income

Assuming the 90 days trading horizon Helix BioPharma Corp is expected to under-perform the Premium Income. In addition to that, Helix BioPharma is 6.43 times more volatile than Premium Income. It trades about -0.06 of its total potential returns per unit of risk. Premium Income is currently generating about 0.02 per unit of volatility. If you would invest  632.00  in Premium Income on September 13, 2024 and sell it today you would earn a total of  5.00  from holding Premium Income or generate 0.79% return on investment over 90 days.

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

Helix BioPharma Corp  vs.  Premium Income

Helix BioPharma Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Helix BioPharma Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Premium Income

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Premium Income are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Premium Income may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Helix BioPharma and Premium Income

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

The idea behind Helix BioPharma Corp and Premium Income 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.