Correlation Between Bio Rad and Value Fund

Can any of the company-specific risk be diversified away by investing in both Bio Rad and Value Fund 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 Bio Rad and Value Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bio Rad Laboratories and Value Fund I, you can compare the effects of market volatilities on Bio Rad and Value Fund 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 Bio Rad with a short position of Value Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bio Rad and Value Fund.

Diversification Opportunities for Bio Rad and Value Fund

0.66

Correlation Coefficient

Bio Rad  Value Fund

Poor diversification

The 3 months correlation between Bio and Value is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Bio Rad Laboratories and Value Fund I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Fund I and Bio Rad 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 Bio Rad Laboratories are associated (or correlated) with Value Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Fund I has no effect on the direction of Bio Rad i.e., Bio Rad and Value Fund go up and down completely randomly.

Pair Corralation between Bio Rad and Value Fund

Considering the 90-day investment horizon Bio Rad Laboratories is expected to generate 2.72 times more return on investment than Value Fund. However, Bio Rad is 2.72 times more volatile than Value Fund I. It trades about 0.13 of its potential returns per unit of risk. Value Fund I is currently generating about 0.21 per unit of risk. If you would invest  24,132  in Bio Rad Laboratories on April 30, 2025 and sell it today you would earn a total of  1,191  from holding Bio Rad Laboratories or generate 4.94% return on investment over 90 days.

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

Bio Rad Laboratories  vs.  Value Fund I

Bio Rad Laboratories

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bio Rad Laboratories are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Bio Rad is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Value Fund I

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Value Fund I are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Value Fund may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Bio Rad and Value Fund

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

The idea behind Bio Rad Laboratories and Value Fund I 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..