Correlation Between Laboratory and Trinity Biotech

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

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

Diversification Opportunities for Laboratory and Trinity Biotech

0.72

Correlation Coefficient

Laboratory  Trinity Biotech

Poor diversification

The 3 months correlation between Laboratory and Trinity is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Laboratory of and Trinity Biotech plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trinity Biotech plc and Laboratory 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 Laboratory of are associated (or correlated) with Trinity Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trinity Biotech plc has no effect on the direction of Laboratory i.e., Laboratory and Trinity Biotech go up and down completely randomly.

Pair Corralation between Laboratory and Trinity Biotech

Allowing for the 90-day total investment horizon Laboratory is expected to generate 8.0 times less return on investment than Trinity Biotech. But when comparing it to its historical volatility, Laboratory of is 9.81 times less risky than Trinity Biotech. It trades about 0.12 of its potential returns per unit of risk. Trinity Biotech plc is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  68.00  in Trinity Biotech plc on July 2, 2025 and sell it today you would earn a total of  36.00  from holding Trinity Biotech plc or generate 52.94% return on investment over 90 days.

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

Laboratory of  vs.  Trinity Biotech plc

Laboratory

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Laboratory of are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Laboratory may actually be approaching a critical reversion point that can send shares even higher in October 2025.

Trinity Biotech plc

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Trinity Biotech plc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward indicators, Trinity Biotech sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Laboratory and Trinity Biotech

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

The idea behind Laboratory of and Trinity Biotech plc 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.