Correlation Between Baxter International and Bionano Genomics

Can any of the company-specific risk be diversified away by investing in both Baxter International and Bionano Genomics 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 Baxter International and Bionano Genomics into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Baxter International and Bionano Genomics

0.57

Correlation Coefficient

Baxter International  Bionano Genomics

Very weak diversification

The 3 months correlation between Baxter and Bionano is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Baxter International and Bionano Genomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bionano Genomics and Baxter International 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 Baxter International are associated (or correlated) with Bionano Genomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bionano Genomics has no effect on the direction of Baxter International i.e., Baxter International and Bionano Genomics go up and down completely randomly.

Pair Corralation between Baxter International and Bionano Genomics

Considering the 90-day investment horizon Baxter International is expected to under-perform the Bionano Genomics. In addition to that, Baxter International is 1.41 times more volatile than Bionano Genomics. It trades about -0.13 of its total potential returns per unit of risk. Bionano Genomics is currently generating about -0.12 per unit of volatility. If you would invest  369.00  in Bionano Genomics on May 7, 2025 and sell it today you would lose (67.00) from holding Bionano Genomics or give up 18.16% of portfolio value over 90 days.

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

Baxter International  vs.  Bionano Genomics

Baxter International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Baxter International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Bionano Genomics

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Baxter International and Bionano Genomics

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

The idea behind Baxter International and Bionano Genomics 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.