Correlation Between Diamyd Medical and Japan Post
Can any of the company-specific risk be diversified away by investing in both Diamyd Medical and Japan Post 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 Diamyd Medical and Japan Post into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamyd Medical AB and Japan Post Insurance, you can compare the effects of market volatilities on Diamyd Medical and Japan Post 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 Diamyd Medical with a short position of Japan Post. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamyd Medical and Japan Post.
Diversification Opportunities for Diamyd Medical and Japan Post
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Diamyd and Japan is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Diamyd Medical AB and Japan Post Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Post Insurance and Diamyd Medical 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 Diamyd Medical AB are associated (or correlated) with Japan Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Post Insurance has no effect on the direction of Diamyd Medical i.e., Diamyd Medical and Japan Post go up and down completely randomly.
Pair Corralation between Diamyd Medical and Japan Post
Assuming the 90 days horizon Diamyd Medical AB is expected to generate 3.17 times more return on investment than Japan Post. However, Diamyd Medical is 3.17 times more volatile than Japan Post Insurance. It trades about 0.22 of its potential returns per unit of risk. Japan Post Insurance is currently generating about -0.19 per unit of risk. If you would invest 112.00 in Diamyd Medical AB on October 30, 2024 and sell it today you would earn a total of 39.00 from holding Diamyd Medical AB or generate 34.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Diamyd Medical AB vs. Japan Post Insurance
Performance |
| Timeline |
| Diamyd Medical AB |
| Japan Post Insurance |
Diamyd Medical and Japan Post Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamyd Medical and Japan Post
The main advantage of trading using opposite Diamyd Medical and Japan Post positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamyd Medical position performs unexpectedly, Japan Post 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 Japan Post will offset losses from the drop in Japan Post's long position.| Diamyd Medical vs. BioNTech SE | Diamyd Medical vs. Agilent Technologies | Diamyd Medical vs. PT Wintermar Offshore | Diamyd Medical vs. United Rentals |
| Japan Post vs. MOVIE GAMES SA | Japan Post vs. GOLD ROAD RES | Japan Post vs. Scandinavian Tobacco Group | Japan Post vs. British American Tobacco |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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