Correlation Between Bavarian Nordic and GomSpace Group
Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and GomSpace Group 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 Bavarian Nordic and GomSpace Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bavarian Nordic and GomSpace Group AB, you can compare the effects of market volatilities on Bavarian Nordic and GomSpace Group 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 Bavarian Nordic with a short position of GomSpace Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and GomSpace Group.
Diversification Opportunities for Bavarian Nordic and GomSpace Group
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bavarian and GomSpace is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and GomSpace Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GomSpace Group AB and Bavarian Nordic 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 Bavarian Nordic are associated (or correlated) with GomSpace Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GomSpace Group AB has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and GomSpace Group go up and down completely randomly.
Pair Corralation between Bavarian Nordic and GomSpace Group
Assuming the 90 days trading horizon Bavarian Nordic is expected to under-perform the GomSpace Group. In addition to that, Bavarian Nordic is 1.02 times more volatile than GomSpace Group AB. It trades about -0.04 of its total potential returns per unit of risk. GomSpace Group AB is currently generating about 0.03 per unit of volatility. If you would invest 378.00 in GomSpace Group AB on October 26, 2024 and sell it today you would earn a total of 12.00 from holding GomSpace Group AB or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.31% |
| Values | Daily Returns |
Bavarian Nordic vs. GomSpace Group AB
Performance |
| Timeline |
| Bavarian Nordic |
| GomSpace Group AB |
Bavarian Nordic and GomSpace Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bavarian Nordic and GomSpace Group
The main advantage of trading using opposite Bavarian Nordic and GomSpace Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, GomSpace Group 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 GomSpace Group will offset losses from the drop in GomSpace Group's long position.| Bavarian Nordic vs. Ambu AS | Bavarian Nordic vs. Danske Bank AS | Bavarian Nordic vs. Genmab AS | Bavarian Nordic vs. DSV Panalpina AS |
| GomSpace Group vs. Ambu AS | GomSpace Group vs. Bavarian Nordic | GomSpace Group vs. Fingerprint Cards AB | GomSpace Group vs. Zealand Pharma AS |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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