Correlation Between Sensorion and Theradiag
Can any of the company-specific risk be diversified away by investing in both Sensorion and Theradiag 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 Sensorion and Theradiag into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensorion SA and Theradiag SA, you can compare the effects of market volatilities on Sensorion and Theradiag 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 Sensorion with a short position of Theradiag. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensorion and Theradiag.
Diversification Opportunities for Sensorion and Theradiag
Weak diversification
The 3 months correlation between Sensorion and Theradiag is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sensorion SA and Theradiag SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Theradiag SA and Sensorion 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 Sensorion SA are associated (or correlated) with Theradiag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Theradiag SA has no effect on the direction of Sensorion i.e., Sensorion and Theradiag go up and down completely randomly.
Pair Corralation between Sensorion and Theradiag
Assuming the 90 days trading horizon Sensorion SA is expected to generate 1.0 times more return on investment than Theradiag. However, Sensorion SA is 1.0 times less risky than Theradiag. It trades about 0.05 of its potential returns per unit of risk. Theradiag SA is currently generating about -0.02 per unit of risk. If you would invest 36.00 in Sensorion SA on November 1, 2024 and sell it today you would earn a total of 26.00 from holding Sensorion SA or generate 72.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sensorion SA vs. Theradiag SA
Performance |
| Timeline |
| Sensorion SA |
| Theradiag SA |
Sensorion and Theradiag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensorion and Theradiag
The main advantage of trading using opposite Sensorion and Theradiag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensorion position performs unexpectedly, Theradiag 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 Theradiag will offset losses from the drop in Theradiag's long position.| Sensorion vs. Poxel SA | Sensorion vs. Quantum Genomics SA | Sensorion vs. Biophytis SA | Sensorion vs. Gensight Biologics SA |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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