Correlation Between Xenetic Biosciences and Precipio

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

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

Diversification Opportunities for Xenetic Biosciences and Precipio

0.69

Correlation Coefficient

Xenetic Biosciences  Precipio

Poor diversification

The 3 months correlation between Xenetic and Precipio is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Xenetic Biosciences and Precipio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precipio and Xenetic Biosciences 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 Xenetic Biosciences are associated (or correlated) with Precipio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precipio has no effect on the direction of Xenetic Biosciences i.e., Xenetic Biosciences and Precipio go up and down completely randomly.

Pair Corralation between Xenetic Biosciences and Precipio

Given the investment horizon of 90 days Xenetic Biosciences is expected to generate 8.06 times less return on investment than Precipio. In addition to that, Xenetic Biosciences is 1.14 times more volatile than Precipio. It trades about 0.03 of its total potential returns per unit of risk. Precipio is currently generating about 0.29 per unit of volatility. If you would invest  650.00  in Precipio on May 7, 2025 and sell it today you would earn a total of  801.00  from holding Precipio or generate 123.23% return on investment over 90 days.

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

Xenetic Biosciences  vs.  Precipio

Xenetic Biosciences

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xenetic Biosciences are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Xenetic Biosciences may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Precipio

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Precipio are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Precipio displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Xenetic Biosciences and Precipio

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

The idea behind Xenetic Biosciences and Precipio 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.