Correlation Between Dynavax Technologies and EnGene Holdings
Can any of the company-specific risk be diversified away by investing in both Dynavax Technologies and EnGene Holdings 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 Dynavax Technologies and EnGene Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynavax Technologies and enGene Holdings Common, you can compare the effects of market volatilities on Dynavax Technologies and EnGene Holdings 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 Dynavax Technologies with a short position of EnGene Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynavax Technologies and EnGene Holdings.
Diversification Opportunities for Dynavax Technologies and EnGene Holdings
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dynavax and EnGene is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dynavax Technologies and enGene Holdings Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on enGene Holdings Common and Dynavax Technologies 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 Dynavax Technologies are associated (or correlated) with EnGene Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of enGene Holdings Common has no effect on the direction of Dynavax Technologies i.e., Dynavax Technologies and EnGene Holdings go up and down completely randomly.
Pair Corralation between Dynavax Technologies and EnGene Holdings
Given the investment horizon of 90 days Dynavax Technologies is expected to generate 3.17 times less return on investment than EnGene Holdings. But when comparing it to its historical volatility, Dynavax Technologies is 5.04 times less risky than EnGene Holdings. It trades about 0.05 of its potential returns per unit of risk. enGene Holdings Common is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,049 in enGene Holdings Common on December 2, 2024 and sell it today you would lose (457.00) from holding enGene Holdings Common or give up 43.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Dynavax Technologies vs. enGene Holdings Common
Performance |
| Timeline |
| Dynavax Technologies |
| enGene Holdings Common |
Dynavax Technologies and EnGene Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynavax Technologies and EnGene Holdings
The main advantage of trading using opposite Dynavax Technologies and EnGene Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynavax Technologies position performs unexpectedly, EnGene Holdings 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 EnGene Holdings will offset losses from the drop in EnGene Holdings' long position.| Dynavax Technologies vs. Alkermes Plc | ||
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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