Correlation Between Ascendis Pharma and Blueprint Medicines
Can any of the company-specific risk be diversified away by investing in both Ascendis Pharma and Blueprint Medicines 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 Ascendis Pharma and Blueprint Medicines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ascendis Pharma AS and Blueprint Medicines Corp, you can compare the effects of market volatilities on Ascendis Pharma and Blueprint Medicines 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 Ascendis Pharma with a short position of Blueprint Medicines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendis Pharma and Blueprint Medicines.
Diversification Opportunities for Ascendis Pharma and Blueprint Medicines
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ascendis and Blueprint is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Ascendis Pharma AS and Blueprint Medicines Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blueprint Medicines Corp and Ascendis Pharma 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 Ascendis Pharma AS are associated (or correlated) with Blueprint Medicines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blueprint Medicines Corp has no effect on the direction of Ascendis Pharma i.e., Ascendis Pharma and Blueprint Medicines go up and down completely randomly.
Pair Corralation between Ascendis Pharma and Blueprint Medicines
Given the investment horizon of 90 days Ascendis Pharma is expected to generate 36.12 times less return on investment than Blueprint Medicines. But when comparing it to its historical volatility, Ascendis Pharma AS is 1.15 times less risky than Blueprint Medicines. It trades about 0.0 of its potential returns per unit of risk. Blueprint Medicines Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,420 in Blueprint Medicines Corp on November 3, 2024 and sell it today you would earn a total of 3,833 from holding Blueprint Medicines Corp or generate 51.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ascendis Pharma AS vs. Blueprint Medicines Corp
Performance |
| Timeline |
| Ascendis Pharma AS |
| Blueprint Medicines Corp |
Ascendis Pharma and Blueprint Medicines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascendis Pharma and Blueprint Medicines
The main advantage of trading using opposite Ascendis Pharma and Blueprint Medicines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascendis Pharma position performs unexpectedly, Blueprint Medicines 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 Blueprint Medicines will offset losses from the drop in Blueprint Medicines' long position.| Ascendis Pharma vs. Apellis Pharmaceuticals | Ascendis Pharma vs. Akero Therapeutics | Ascendis Pharma vs. Blueprint Medicines Corp | Ascendis Pharma vs. Replimune Group |
| Blueprint Medicines vs. Terns Pharmaceuticals | Blueprint Medicines vs. Amylyx Pharmaceuticals | Blueprint Medicines vs. Acumen Pharmaceuticals | Blueprint Medicines vs. Inozyme Pharma |
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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