Correlation Between Ascendis Pharma and Ginkgo Bioworks
Can any of the company-specific risk be diversified away by investing in both Ascendis Pharma and Ginkgo Bioworks 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 Ginkgo Bioworks 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 Ginkgo Bioworks Holdings, you can compare the effects of market volatilities on Ascendis Pharma and Ginkgo Bioworks 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 Ginkgo Bioworks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendis Pharma and Ginkgo Bioworks.
Diversification Opportunities for Ascendis Pharma and Ginkgo Bioworks
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ascendis and Ginkgo is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ascendis Pharma AS and Ginkgo Bioworks Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ginkgo Bioworks Holdings 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 Ginkgo Bioworks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ginkgo Bioworks Holdings has no effect on the direction of Ascendis Pharma i.e., Ascendis Pharma and Ginkgo Bioworks go up and down completely randomly.
Pair Corralation between Ascendis Pharma and Ginkgo Bioworks
Given the investment horizon of 90 days Ascendis Pharma AS is expected to generate 0.35 times more return on investment than Ginkgo Bioworks. However, Ascendis Pharma AS is 2.9 times less risky than Ginkgo Bioworks. It trades about 0.24 of its potential returns per unit of risk. Ginkgo Bioworks Holdings is currently generating about 0.07 per unit of risk. If you would invest 12,280 in Ascendis Pharma AS on August 31, 2024 and sell it today you would earn a total of 1,352 from holding Ascendis Pharma AS or generate 11.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ascendis Pharma AS vs. Ginkgo Bioworks Holdings
Performance |
| Timeline |
| Ascendis Pharma AS |
| Ginkgo Bioworks Holdings |
Ascendis Pharma and Ginkgo Bioworks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascendis Pharma and Ginkgo Bioworks
The main advantage of trading using opposite Ascendis Pharma and Ginkgo Bioworks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascendis Pharma position performs unexpectedly, Ginkgo Bioworks 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 Ginkgo Bioworks will offset losses from the drop in Ginkgo Bioworks' long position.| Ascendis Pharma vs. Apellis Pharmaceuticals | Ascendis Pharma vs. BeiGene | Ascendis Pharma vs. Akero Therapeutics | Ascendis Pharma vs. Blueprint Medicines Corp |
| Ginkgo Bioworks vs. Ocean Biomedical | Ginkgo Bioworks vs. Enveric Biosciences | Ginkgo Bioworks vs. Hepion Pharmaceuticals | Ginkgo Bioworks vs. Elevation Oncology |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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