Correlation Between Bion Environmental and Tobii AB

Can any of the company-specific risk be diversified away by investing in both Bion Environmental and Tobii AB 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 Bion Environmental and Tobii AB into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bion Environmental Technologies and Tobii AB, you can compare the effects of market volatilities on Bion Environmental and Tobii AB 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 Bion Environmental with a short position of Tobii AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bion Environmental and Tobii AB.

Diversification Opportunities for Bion Environmental and Tobii AB

0.66

Correlation Coefficient

Bion Environmental  Tobii AB

Poor diversification

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

Pair Corralation between Bion Environmental and Tobii AB

Given the investment horizon of 90 days Bion Environmental Technologies is expected to generate 2.02 times more return on investment than Tobii AB. However, Bion Environmental is 2.02 times more volatile than Tobii AB. It trades about 0.11 of its potential returns per unit of risk. Tobii AB is currently generating about 0.14 per unit of risk. If you would invest  12.00  in Bion Environmental Technologies on May 3, 2025 and sell it today you would earn a total of  8.00  from holding Bion Environmental Technologies or generate 66.67% return on investment over 90 days.

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

Bion Environmental Technologie  vs.  Tobii AB

Bion Environmental

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bion Environmental Technologies are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Bion Environmental unveiled solid returns over the last few months and may actually be approaching a breakup point.

Tobii AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tobii AB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward indicators, Tobii AB reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bion Environmental and Tobii AB

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

The idea behind Bion Environmental Technologies and Tobii AB 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.