Correlation Between Bavarian Nordic and Vicore Pharma
Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and Vicore Pharma 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 Vicore Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bavarian Nordic and Vicore Pharma Holding, you can compare the effects of market volatilities on Bavarian Nordic and Vicore Pharma 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 Vicore Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and Vicore Pharma.
Diversification Opportunities for Bavarian Nordic and Vicore Pharma
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bavarian and Vicore is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and Vicore Pharma Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicore Pharma Holding 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 Vicore Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicore Pharma Holding has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and Vicore Pharma go up and down completely randomly.
Pair Corralation between Bavarian Nordic and Vicore Pharma
Assuming the 90 days trading horizon Bavarian Nordic is expected to under-perform the Vicore Pharma. In addition to that, Bavarian Nordic is 1.1 times more volatile than Vicore Pharma Holding. It trades about -0.08 of its total potential returns per unit of risk. Vicore Pharma Holding is currently generating about 0.1 per unit of volatility. If you would invest 700.00 in Vicore Pharma Holding on August 25, 2024 and sell it today you would earn a total of 91.00 from holding Vicore Pharma Holding or generate 13.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bavarian Nordic vs. Vicore Pharma Holding
Performance |
| Timeline |
| Bavarian Nordic |
| Vicore Pharma Holding |
Bavarian Nordic and Vicore Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bavarian Nordic and Vicore Pharma
The main advantage of trading using opposite Bavarian Nordic and Vicore Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, Vicore Pharma 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 Vicore Pharma will offset losses from the drop in Vicore Pharma'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 |
| Vicore Pharma vs. Bavarian Nordic | Vicore Pharma vs. BioPorto | Vicore Pharma vs. Zaptec AS | Vicore Pharma vs. cBrain 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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