Correlation Between DiaMedica Therapeutics and Genelux Common
Can any of the company-specific risk be diversified away by investing in both DiaMedica Therapeutics and Genelux Common 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 DiaMedica Therapeutics and Genelux Common into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DiaMedica Therapeutics and Genelux Common, you can compare the effects of market volatilities on DiaMedica Therapeutics and Genelux Common 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 DiaMedica Therapeutics with a short position of Genelux Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of DiaMedica Therapeutics and Genelux Common.
Diversification Opportunities for DiaMedica Therapeutics and Genelux Common
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DiaMedica and Genelux is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding DiaMedica Therapeutics and Genelux Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genelux Common and DiaMedica Therapeutics 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 DiaMedica Therapeutics are associated (or correlated) with Genelux Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genelux Common has no effect on the direction of DiaMedica Therapeutics i.e., DiaMedica Therapeutics and Genelux Common go up and down completely randomly.
Pair Corralation between DiaMedica Therapeutics and Genelux Common
Given the investment horizon of 90 days DiaMedica Therapeutics is expected to generate 0.6 times more return on investment than Genelux Common. However, DiaMedica Therapeutics is 1.68 times less risky than Genelux Common. It trades about 0.08 of its potential returns per unit of risk. Genelux Common is currently generating about 0.01 per unit of risk. If you would invest 154.00 in DiaMedica Therapeutics on September 12, 2024 and sell it today you would earn a total of 362.00 from holding DiaMedica Therapeutics or generate 235.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.56% |
| Values | Daily Returns |
DiaMedica Therapeutics vs. Genelux Common
Performance |
| Timeline |
| DiaMedica Therapeutics |
| Genelux Common |
DiaMedica Therapeutics and Genelux Common Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DiaMedica Therapeutics and Genelux Common
The main advantage of trading using opposite DiaMedica Therapeutics and Genelux Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DiaMedica Therapeutics position performs unexpectedly, Genelux Common 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 Genelux Common will offset losses from the drop in Genelux Common's long position.| DiaMedica Therapeutics vs. Milestone Pharmaceuticals | DiaMedica Therapeutics vs. Seres Therapeutics | DiaMedica Therapeutics vs. Inhibikase Therapeutics | DiaMedica Therapeutics vs. Oncolytics Biotech |
| Genelux Common vs. Equillium | Genelux Common vs. DiaMedica Therapeutics | Genelux Common vs. Valneva SE ADR | Genelux Common vs. Vivani Medical |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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