Correlation Between Ascendis Pharma and Genmab AS
Can any of the company-specific risk be diversified away by investing in both Ascendis Pharma and Genmab AS 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 Genmab AS 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 Genmab AS, you can compare the effects of market volatilities on Ascendis Pharma and Genmab AS 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 Genmab AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendis Pharma and Genmab AS.
Diversification Opportunities for Ascendis Pharma and Genmab AS
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ascendis and Genmab is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ascendis Pharma AS and Genmab AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genmab AS 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 Genmab AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genmab AS has no effect on the direction of Ascendis Pharma i.e., Ascendis Pharma and Genmab AS go up and down completely randomly.
Pair Corralation between Ascendis Pharma and Genmab AS
Given the investment horizon of 90 days Ascendis Pharma AS is expected to generate 1.01 times more return on investment than Genmab AS. However, Ascendis Pharma is 1.01 times more volatile than Genmab AS. It trades about -0.11 of its potential returns per unit of risk. Genmab AS is currently generating about -0.22 per unit of risk. If you would invest 13,443 in Ascendis Pharma AS on November 9, 2024 and sell it today you would lose (941.00) from holding Ascendis Pharma AS or give up 7.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ascendis Pharma AS vs. Genmab AS
Performance |
| Timeline |
| Ascendis Pharma AS |
| Genmab AS |
Ascendis Pharma and Genmab AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascendis Pharma and Genmab AS
The main advantage of trading using opposite Ascendis Pharma and Genmab AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascendis Pharma position performs unexpectedly, Genmab AS 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 Genmab AS will offset losses from the drop in Genmab AS's long position.| Ascendis Pharma vs. Apellis Pharmaceuticals | Ascendis Pharma vs. Akero Therapeutics | Ascendis Pharma vs. Blueprint Medicines Corp | Ascendis Pharma vs. Replimune Group |
| Genmab AS vs. Ascendis Pharma AS | Genmab AS vs. Apellis Pharmaceuticals | Genmab AS vs. Akero Therapeutics | Genmab AS vs. Blueprint Medicines Corp |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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