Correlation Between CBrain AS and Kancera AB
Can any of the company-specific risk be diversified away by investing in both CBrain AS and Kancera AB 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 Kancera AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cBrain AS and Kancera AB, you can compare the effects of market volatilities on CBrain AS and Kancera AB 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 Kancera AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBrain AS and Kancera AB.
Diversification Opportunities for CBrain AS and Kancera AB
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CBrain and Kancera is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding cBrain AS and Kancera AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kancera AB 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 Kancera AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kancera AB has no effect on the direction of CBrain AS i.e., CBrain AS and Kancera AB go up and down completely randomly.
Pair Corralation between CBrain AS and Kancera AB
Assuming the 90 days trading horizon cBrain AS is expected to generate 0.44 times more return on investment than Kancera AB. However, cBrain AS is 2.29 times less risky than Kancera AB. It trades about -0.01 of its potential returns per unit of risk. Kancera AB is currently generating about -0.05 per unit of risk. If you would invest 24,600 in cBrain AS on August 26, 2024 and sell it today you would lose (4,300) from holding cBrain AS or give up 17.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
cBrain AS vs. Kancera AB
Performance |
| Timeline |
| cBrain AS |
| Kancera AB |
CBrain AS and Kancera AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBrain AS and Kancera AB
The main advantage of trading using opposite CBrain AS and Kancera AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBrain AS position performs unexpectedly, Kancera AB 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 Kancera AB will offset losses from the drop in Kancera AB's long position.| CBrain AS vs. ChemoMetec AS | CBrain AS vs. Ambu AS | CBrain AS vs. Genmab AS | CBrain AS vs. Zealand Pharma AS |
| Kancera AB vs. Bavarian Nordic | Kancera AB vs. BioPorto | Kancera AB vs. Zaptec AS | Kancera AB 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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