Correlation Between Bio Rad and Abrdn Asia

Can any of the company-specific risk be diversified away by investing in both Bio Rad and Abrdn Asia 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 Abrdn Asia 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 abrdn Asia Pacific, you can compare the effects of market volatilities on Bio Rad and Abrdn Asia 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 Abrdn Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bio Rad and Abrdn Asia.

Diversification Opportunities for Bio Rad and Abrdn Asia

0.04

Correlation Coefficient

Bio Rad  Abrdn Asia

Significant diversification

The 3 months correlation between Bio and Abrdn is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bio Rad Laboratories and abrdn Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Asia Pacific 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 Abrdn Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Asia Pacific has no effect on the direction of Bio Rad i.e., Bio Rad and Abrdn Asia go up and down completely randomly.

Pair Corralation between Bio Rad and Abrdn Asia

Considering the 90-day investment horizon Bio Rad Laboratories is expected to generate 5.52 times more return on investment than Abrdn Asia. However, Bio Rad is 5.52 times more volatile than abrdn Asia Pacific. It trades about 0.1 of its potential returns per unit of risk. abrdn Asia Pacific is currently generating about 0.05 per unit of risk. If you would invest  24,019  in Bio Rad Laboratories on May 4, 2025 and sell it today you would earn a total of  4,441  from holding Bio Rad Laboratories or generate 18.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Bio Rad Laboratories  vs.  abrdn Asia Pacific

Bio Rad Laboratories

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bio Rad Laboratories are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Bio Rad displayed solid returns over the last few months and may actually be approaching a breakup point.

abrdn Asia Pacific

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in abrdn Asia Pacific are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Abrdn Asia is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Bio Rad and Abrdn Asia

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

The idea behind Bio Rad Laboratories and abrdn Asia Pacific 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.