Correlation Between CBrain AS and XSpray Pharma
Can any of the company-specific risk be diversified away by investing in both CBrain AS and XSpray 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 CBrain AS and XSpray Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cBrain AS and XSpray Pharma AB, you can compare the effects of market volatilities on CBrain AS and XSpray 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 CBrain AS with a short position of XSpray Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBrain AS and XSpray Pharma.
Diversification Opportunities for CBrain AS and XSpray Pharma
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CBrain and XSpray is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding cBrain AS and XSpray Pharma AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XSpray Pharma 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 XSpray Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XSpray Pharma AB has no effect on the direction of CBrain AS i.e., CBrain AS and XSpray Pharma go up and down completely randomly.
Pair Corralation between CBrain AS and XSpray Pharma
Assuming the 90 days trading horizon cBrain AS is expected to generate 0.72 times more return on investment than XSpray Pharma. However, cBrain AS is 1.39 times less risky than XSpray Pharma. It trades about 0.03 of its potential returns per unit of risk. XSpray Pharma AB is currently generating about 0.01 per unit of risk. If you would invest 16,375 in cBrain AS on September 12, 2024 and sell it today you would earn a total of 4,325 from holding cBrain AS or generate 26.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
cBrain AS vs. XSpray Pharma AB
Performance |
| Timeline |
| cBrain AS |
| XSpray Pharma AB |
CBrain AS and XSpray Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBrain AS and XSpray Pharma
The main advantage of trading using opposite CBrain AS and XSpray Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBrain AS position performs unexpectedly, XSpray 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 XSpray Pharma will offset losses from the drop in XSpray Pharma's long position.| CBrain AS vs. ChemoMetec AS | CBrain AS vs. Ambu AS | CBrain AS vs. Genmab AS | CBrain AS vs. Zealand Pharma AS |
| XSpray Pharma vs. Bavarian Nordic | XSpray Pharma vs. BioPorto | XSpray Pharma vs. Zaptec AS | XSpray 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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