Correlation Between Genmab AS and Blueprint Medicines
Can any of the company-specific risk be diversified away by investing in both Genmab AS and Blueprint Medicines 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 Blueprint Medicines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genmab AS and Blueprint Medicines Corp, you can compare the effects of market volatilities on Genmab AS and Blueprint Medicines 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 Blueprint Medicines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genmab AS and Blueprint Medicines.
Diversification Opportunities for Genmab AS and Blueprint Medicines
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Genmab and Blueprint is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Genmab AS and Blueprint Medicines Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blueprint Medicines Corp 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 Blueprint Medicines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blueprint Medicines Corp has no effect on the direction of Genmab AS i.e., Genmab AS and Blueprint Medicines go up and down completely randomly.
Pair Corralation between Genmab AS and Blueprint Medicines
Given the investment horizon of 90 days Genmab AS is expected to generate 0.66 times more return on investment than Blueprint Medicines. However, Genmab AS is 1.51 times less risky than Blueprint Medicines. It trades about 0.09 of its potential returns per unit of risk. Blueprint Medicines Corp is currently generating about 0.03 per unit of risk. If you would invest 2,076 in Genmab AS on November 23, 2024 and sell it today you would earn a total of 168.00 from holding Genmab AS or generate 8.09% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Genmab AS vs. Blueprint Medicines Corp
Performance |
Timeline |
Genmab AS |
Blueprint Medicines Corp |
Genmab AS and Blueprint Medicines Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Genmab AS and Blueprint Medicines
The main advantage of trading using opposite Genmab AS and Blueprint Medicines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genmab AS position performs unexpectedly, Blueprint Medicines 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 Blueprint Medicines will offset losses from the drop in Blueprint Medicines' long position.Genmab AS vs. Ascendis Pharma AS | ||
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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 CEOs Directory module to screen CEOs from public companies around the world.
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