Correlation Between Boule Diagnostics and GomSpace Group
Can any of the company-specific risk be diversified away by investing in both Boule Diagnostics 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 Boule Diagnostics and GomSpace Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boule Diagnostics AB and GomSpace Group AB, you can compare the effects of market volatilities on Boule Diagnostics 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 Boule Diagnostics with a short position of GomSpace Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boule Diagnostics and GomSpace Group.
Diversification Opportunities for Boule Diagnostics and GomSpace Group
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Boule and GomSpace is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Boule Diagnostics AB 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 Boule Diagnostics 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 Boule Diagnostics AB 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 Boule Diagnostics i.e., Boule Diagnostics and GomSpace Group go up and down completely randomly.
Pair Corralation between Boule Diagnostics and GomSpace Group
Assuming the 90 days trading horizon Boule Diagnostics AB is expected to under-perform the GomSpace Group. But the stock apears to be less risky and, when comparing its historical volatility, Boule Diagnostics AB is 1.07 times less risky than GomSpace Group. The stock trades about -0.04 of its potential returns per unit of risk. The GomSpace Group AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 439.00 in GomSpace Group AB on September 1, 2024 and sell it today you would earn a total of 19.00 from holding GomSpace Group AB or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boule Diagnostics AB vs. GomSpace Group AB
Performance |
| Timeline |
| Boule Diagnostics |
| GomSpace Group AB |
Boule Diagnostics and GomSpace Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boule Diagnostics and GomSpace Group
The main advantage of trading using opposite Boule Diagnostics and GomSpace Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boule Diagnostics 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.| Boule Diagnostics vs. Cantargia AB | Boule Diagnostics vs. BioArctic AB | Boule Diagnostics vs. Oncopeptides AB | Boule Diagnostics vs. Hansa Biopharma AB |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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