Correlation Between Genfit and Pharnext
Can any of the company-specific risk be diversified away by investing in both Genfit and Pharnext 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 Genfit and Pharnext into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genfit and Pharnext SA, you can compare the effects of market volatilities on Genfit and Pharnext 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 Genfit with a short position of Pharnext. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genfit and Pharnext.
Diversification Opportunities for Genfit and Pharnext
Pay attention - limited upside
The 3 months correlation between Genfit and Pharnext is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Genfit and Pharnext SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharnext SA and Genfit 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 Genfit are associated (or correlated) with Pharnext. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharnext SA has no effect on the direction of Genfit i.e., Genfit and Pharnext go up and down completely randomly.
Pair Corralation between Genfit and Pharnext
Assuming the 90 days trading horizon Genfit is expected to generate 0.1 times more return on investment than Pharnext. However, Genfit is 10.24 times less risky than Pharnext. It trades about 0.03 of its potential returns per unit of risk. Pharnext SA is currently generating about -0.05 per unit of risk. If you would invest 335.00 in Genfit on September 3, 2024 and sell it today you would earn a total of 56.00 from holding Genfit or generate 16.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genfit vs. Pharnext SA
Performance |
| Timeline |
| Genfit |
| Pharnext SA |
Genfit and Pharnext Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genfit and Pharnext
The main advantage of trading using opposite Genfit and Pharnext positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genfit position performs unexpectedly, Pharnext 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 Pharnext will offset losses from the drop in Pharnext's long position.The idea behind Genfit and Pharnext SA 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.| Pharnext vs. Valneva SE | Pharnext vs. Abivax SA | Pharnext vs. DBV Technologies SA | Pharnext vs. Innate Pharma |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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