Correlation Between Everfuel and ExpreS2ion Biotech
Can any of the company-specific risk be diversified away by investing in both Everfuel and ExpreS2ion Biotech 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 Everfuel and ExpreS2ion Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Everfuel AS and ExpreS2ion Biotech Holding, you can compare the effects of market volatilities on Everfuel and ExpreS2ion Biotech 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 Everfuel with a short position of ExpreS2ion Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Everfuel and ExpreS2ion Biotech.
Diversification Opportunities for Everfuel and ExpreS2ion Biotech
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Everfuel and ExpreS2ion is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Everfuel AS and ExpreS2ion Biotech Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ExpreS2ion Biotech and Everfuel 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 Everfuel AS are associated (or correlated) with ExpreS2ion Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ExpreS2ion Biotech has no effect on the direction of Everfuel i.e., Everfuel and ExpreS2ion Biotech go up and down completely randomly.
Pair Corralation between Everfuel and ExpreS2ion Biotech
Assuming the 90 days trading horizon Everfuel AS is expected to generate 0.28 times more return on investment than ExpreS2ion Biotech. However, Everfuel AS is 3.6 times less risky than ExpreS2ion Biotech. It trades about 0.05 of its potential returns per unit of risk. ExpreS2ion Biotech Holding is currently generating about -0.67 per unit of risk. If you would invest 1,258 in Everfuel AS on August 26, 2024 and sell it today you would earn a total of 14.00 from holding Everfuel AS or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Everfuel AS vs. ExpreS2ion Biotech Holding
Performance |
| Timeline |
| Everfuel AS |
| ExpreS2ion Biotech |
Everfuel and ExpreS2ion Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Everfuel and ExpreS2ion Biotech
The main advantage of trading using opposite Everfuel and ExpreS2ion Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Everfuel position performs unexpectedly, ExpreS2ion Biotech 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 ExpreS2ion Biotech will offset losses from the drop in ExpreS2ion Biotech's long position.The idea behind Everfuel AS and ExpreS2ion Biotech Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ExpreS2ion Biotech vs. Bavarian Nordic | ExpreS2ion Biotech vs. BioPorto | ExpreS2ion Biotech vs. Zaptec AS | ExpreS2ion Biotech 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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