Correlation Between Cantargia and AlzeCure Pharma
Can any of the company-specific risk be diversified away by investing in both Cantargia and AlzeCure 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 Cantargia and AlzeCure Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cantargia AB and AlzeCure Pharma, you can compare the effects of market volatilities on Cantargia and AlzeCure 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 Cantargia with a short position of AlzeCure Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cantargia and AlzeCure Pharma.
Diversification Opportunities for Cantargia and AlzeCure Pharma
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cantargia and AlzeCure is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Cantargia AB and AlzeCure Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AlzeCure Pharma and Cantargia 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 Cantargia AB are associated (or correlated) with AlzeCure Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AlzeCure Pharma has no effect on the direction of Cantargia i.e., Cantargia and AlzeCure Pharma go up and down completely randomly.
Pair Corralation between Cantargia and AlzeCure Pharma
Assuming the 90 days trading horizon Cantargia AB is expected to under-perform the AlzeCure Pharma. In addition to that, Cantargia is 1.2 times more volatile than AlzeCure Pharma. It trades about -0.26 of its total potential returns per unit of risk. AlzeCure Pharma is currently generating about -0.24 per unit of volatility. If you would invest 177.00 in AlzeCure Pharma on September 1, 2024 and sell it today you would lose (58.00) from holding AlzeCure Pharma or give up 32.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cantargia AB vs. AlzeCure Pharma
Performance |
| Timeline |
| Cantargia AB |
| AlzeCure Pharma |
Cantargia and AlzeCure Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cantargia and AlzeCure Pharma
The main advantage of trading using opposite Cantargia and AlzeCure Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cantargia position performs unexpectedly, AlzeCure 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 AlzeCure Pharma will offset losses from the drop in AlzeCure Pharma's long position.| Cantargia vs. Hansa Biopharma AB | Cantargia vs. Oncopeptides AB | Cantargia vs. BioArctic AB | Cantargia vs. Alligator Bioscience AB |
| AlzeCure Pharma vs. Kancera AB | AlzeCure Pharma vs. Cyxone AB | AlzeCure Pharma vs. Lidds AB | AlzeCure Pharma vs. Cantargia AB |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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