Correlation Between CBrain AS and Egetis Therapeutics
Can any of the company-specific risk be diversified away by investing in both CBrain AS and Egetis Therapeutics 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 CBrain AS and Egetis Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cBrain AS and Egetis Therapeutics AB, you can compare the effects of market volatilities on CBrain AS and Egetis Therapeutics 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 CBrain AS with a short position of Egetis Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBrain AS and Egetis Therapeutics.
Diversification Opportunities for CBrain AS and Egetis Therapeutics
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between CBrain and Egetis is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding cBrain AS and Egetis Therapeutics AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Egetis Therapeutics and CBrain AS 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 cBrain AS are associated (or correlated) with Egetis Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Egetis Therapeutics has no effect on the direction of CBrain AS i.e., CBrain AS and Egetis Therapeutics go up and down completely randomly.
Pair Corralation between CBrain AS and Egetis Therapeutics
Assuming the 90 days trading horizon CBrain AS is expected to generate 4.25 times less return on investment than Egetis Therapeutics. But when comparing it to its historical volatility, cBrain AS is 1.13 times less risky than Egetis Therapeutics. It trades about 0.07 of its potential returns per unit of risk. Egetis Therapeutics AB is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 451.00 in Egetis Therapeutics AB on August 29, 2024 and sell it today you would earn a total of 109.00 from holding Egetis Therapeutics AB or generate 24.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
cBrain AS vs. Egetis Therapeutics AB
Performance |
| Timeline |
| cBrain AS |
| Egetis Therapeutics |
CBrain AS and Egetis Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBrain AS and Egetis Therapeutics
The main advantage of trading using opposite CBrain AS and Egetis Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBrain AS position performs unexpectedly, Egetis Therapeutics 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 Egetis Therapeutics will offset losses from the drop in Egetis Therapeutics' long position.| CBrain AS vs. ChemoMetec AS | CBrain AS vs. Ambu AS | CBrain AS vs. Genmab AS | CBrain AS vs. Zealand Pharma AS |
| Egetis Therapeutics vs. Hansa Biopharma AB | Egetis Therapeutics vs. Xbrane Biopharma AB | Egetis Therapeutics vs. BioArctic 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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