Correlation Between Egetis Therapeutics and Spago Nanomedical
Can any of the company-specific risk be diversified away by investing in both Egetis Therapeutics and Spago Nanomedical 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 Egetis Therapeutics and Spago Nanomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Egetis Therapeutics AB and Spago Nanomedical AB, you can compare the effects of market volatilities on Egetis Therapeutics and Spago Nanomedical 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 Egetis Therapeutics with a short position of Spago Nanomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Egetis Therapeutics and Spago Nanomedical.
Diversification Opportunities for Egetis Therapeutics and Spago Nanomedical
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Egetis and Spago is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Egetis Therapeutics AB and Spago Nanomedical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spago Nanomedical and Egetis 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 Egetis Therapeutics AB are associated (or correlated) with Spago Nanomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spago Nanomedical has no effect on the direction of Egetis Therapeutics i.e., Egetis Therapeutics and Spago Nanomedical go up and down completely randomly.
Pair Corralation between Egetis Therapeutics and Spago Nanomedical
Assuming the 90 days trading horizon Egetis Therapeutics AB is expected to generate 0.82 times more return on investment than Spago Nanomedical. However, Egetis Therapeutics AB is 1.21 times less risky than Spago Nanomedical. It trades about 0.04 of its potential returns per unit of risk. Spago Nanomedical AB is currently generating about 0.02 per unit of risk. If you would invest 538.00 in Egetis Therapeutics AB on November 7, 2024 and sell it today you would earn a total of 92.00 from holding Egetis Therapeutics AB or generate 17.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Egetis Therapeutics AB vs. Spago Nanomedical AB
Performance |
| Timeline |
| Egetis Therapeutics |
| Spago Nanomedical |
Egetis Therapeutics and Spago Nanomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Egetis Therapeutics and Spago Nanomedical
The main advantage of trading using opposite Egetis Therapeutics and Spago Nanomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Egetis Therapeutics position performs unexpectedly, Spago Nanomedical 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 Spago Nanomedical will offset losses from the drop in Spago Nanomedical's long position.| Egetis Therapeutics vs. Oncopeptides AB | Egetis Therapeutics vs. Hansa Biopharma AB | Egetis Therapeutics vs. Cantargia AB |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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