Correlation Between Genmab AS and Ambu AS
Can any of the company-specific risk be diversified away by investing in both Genmab AS and Ambu AS 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 Genmab AS and Ambu AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genmab AS and Ambu AS, you can compare the effects of market volatilities on Genmab AS and Ambu AS 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 Genmab AS with a short position of Ambu AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genmab AS and Ambu AS.
Diversification Opportunities for Genmab AS and Ambu AS
Significant diversification
The 3 months correlation between Genmab and Ambu is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Genmab AS and Ambu AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ambu AS and Genmab AS 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 Genmab AS are associated (or correlated) with Ambu AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ambu AS has no effect on the direction of Genmab AS i.e., Genmab AS and Ambu AS go up and down completely randomly.
Pair Corralation between Genmab AS and Ambu AS
Assuming the 90 days trading horizon Genmab AS is expected to under-perform the Ambu AS. But the stock apears to be less risky and, when comparing its historical volatility, Genmab AS is 1.44 times less risky than Ambu AS. The stock trades about -0.07 of its potential returns per unit of risk. The Ambu AS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 12,921 in Ambu AS on November 1, 2024 and sell it today you would earn a total of 1,019 from holding Ambu AS or generate 7.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genmab AS vs. Ambu AS
Performance |
| Timeline |
| Genmab AS |
| Ambu AS |
Genmab AS and Ambu AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genmab AS and Ambu AS
The main advantage of trading using opposite Genmab AS and Ambu AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genmab AS position performs unexpectedly, Ambu AS 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 Ambu AS will offset losses from the drop in Ambu AS's long position.| Genmab AS vs. Ambu AS | Genmab AS vs. DSV Panalpina AS | Genmab AS vs. Bavarian Nordic | Genmab AS vs. GN Store Nord |
| Ambu AS vs. Bavarian Nordic | Ambu AS vs. Genmab AS | Ambu AS vs. GN Store Nord | Ambu AS vs. DSV Panalpina 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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