Correlation Between Affimed NV and Hepion Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Affimed NV and Hepion Pharmaceuticals 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 Affimed NV and Hepion Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affimed NV and Hepion Pharmaceuticals, you can compare the effects of market volatilities on Affimed NV and Hepion Pharmaceuticals 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 Affimed NV with a short position of Hepion Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affimed NV and Hepion Pharmaceuticals.
Diversification Opportunities for Affimed NV and Hepion Pharmaceuticals
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Affimed and Hepion is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Affimed NV and Hepion Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hepion Pharmaceuticals and Affimed NV 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 Affimed NV are associated (or correlated) with Hepion Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hepion Pharmaceuticals has no effect on the direction of Affimed NV i.e., Affimed NV and Hepion Pharmaceuticals go up and down completely randomly.
Pair Corralation between Affimed NV and Hepion Pharmaceuticals
Given the investment horizon of 90 days Affimed NV is expected to under-perform the Hepion Pharmaceuticals. In addition to that, Affimed NV is 1.88 times more volatile than Hepion Pharmaceuticals. It trades about -0.41 of its total potential returns per unit of risk. Hepion Pharmaceuticals is currently generating about -0.3 per unit of volatility. If you would invest 69.00 in Hepion Pharmaceuticals on September 18, 2024 and sell it today you would lose (16.67) from holding Hepion Pharmaceuticals or give up 24.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affimed NV vs. Hepion Pharmaceuticals
Performance |
| Timeline |
| Affimed NV |
| Hepion Pharmaceuticals |
Affimed NV and Hepion Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affimed NV and Hepion Pharmaceuticals
The main advantage of trading using opposite Affimed NV and Hepion Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affimed NV position performs unexpectedly, Hepion Pharmaceuticals 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 Hepion Pharmaceuticals will offset losses from the drop in Hepion Pharmaceuticals' long position.| Affimed NV vs. Pieris Pharmaceuticals | Affimed NV vs. ADC Therapeutics SA | Affimed NV vs. Agenus Inc | Affimed NV vs. X4 Pharmaceuticals |
| Hepion Pharmaceuticals vs. Emergent Biosolutions | Hepion Pharmaceuticals vs. Neurocrine Biosciences | Hepion Pharmaceuticals vs. Teva Pharma Industries | Hepion Pharmaceuticals vs. Haleon plc |
Check out your portfolio center.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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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