Correlation Between Genmab AS and Scilex Holding
Can any of the company-specific risk be diversified away by investing in both Genmab AS and Scilex Holding 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 Scilex Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genmab AS and Scilex Holding, you can compare the effects of market volatilities on Genmab AS and Scilex Holding 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 Scilex Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genmab AS and Scilex Holding.
Diversification Opportunities for Genmab AS and Scilex Holding
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Genmab and Scilex is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Genmab AS and Scilex Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scilex Holding 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 Scilex Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scilex Holding has no effect on the direction of Genmab AS i.e., Genmab AS and Scilex Holding go up and down completely randomly.
Pair Corralation between Genmab AS and Scilex Holding
Given the investment horizon of 90 days Genmab AS is expected to generate 0.24 times more return on investment than Scilex Holding. However, Genmab AS is 4.1 times less risky than Scilex Holding. It trades about -0.14 of its potential returns per unit of risk. Scilex Holding is currently generating about -0.22 per unit of risk. If you would invest 2,232 in Genmab AS on September 1, 2024 and sell it today you would lose (116.00) from holding Genmab AS or give up 5.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Genmab AS vs. Scilex Holding
Performance |
| Timeline |
| Genmab AS |
| Scilex Holding |
Genmab AS and Scilex Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genmab AS and Scilex Holding
The main advantage of trading using opposite Genmab AS and Scilex Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genmab AS position performs unexpectedly, Scilex Holding 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 Scilex Holding will offset losses from the drop in Scilex Holding's long position.| Genmab AS vs. Tff Pharmaceuticals | Genmab AS vs. Eliem Therapeutics | Genmab AS vs. Inhibrx | Genmab AS vs. Enliven Therapeutics |
| Scilex Holding vs. AstraZeneca PLC ADR | Scilex Holding vs. Gilead Sciences | Scilex Holding vs. Bristol Myers Squibb | Scilex Holding vs. Amgen Inc |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |