Correlation Between GomSpace Group and Hansa Biopharma
Can any of the company-specific risk be diversified away by investing in both GomSpace Group and Hansa Biopharma 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 GomSpace Group and Hansa Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GomSpace Group AB and Hansa Biopharma AB, you can compare the effects of market volatilities on GomSpace Group and Hansa Biopharma 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 GomSpace Group with a short position of Hansa Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of GomSpace Group and Hansa Biopharma.
Diversification Opportunities for GomSpace Group and Hansa Biopharma
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GomSpace and Hansa is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding GomSpace Group AB and Hansa Biopharma AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansa Biopharma AB and GomSpace Group 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 GomSpace Group AB are associated (or correlated) with Hansa Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansa Biopharma AB has no effect on the direction of GomSpace Group i.e., GomSpace Group and Hansa Biopharma go up and down completely randomly.
Pair Corralation between GomSpace Group and Hansa Biopharma
Assuming the 90 days trading horizon GomSpace Group AB is expected to generate 1.03 times more return on investment than Hansa Biopharma. However, GomSpace Group is 1.03 times more volatile than Hansa Biopharma AB. It trades about 0.26 of its potential returns per unit of risk. Hansa Biopharma AB is currently generating about -0.27 per unit of risk. If you would invest 378.00 in GomSpace Group AB on August 29, 2024 and sell it today you would earn a total of 79.00 from holding GomSpace Group AB or generate 20.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GomSpace Group AB vs. Hansa Biopharma AB
Performance |
| Timeline |
| GomSpace Group AB |
| Hansa Biopharma AB |
GomSpace Group and Hansa Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GomSpace Group and Hansa Biopharma
The main advantage of trading using opposite GomSpace Group and Hansa Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GomSpace Group position performs unexpectedly, Hansa Biopharma 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 Hansa Biopharma will offset losses from the drop in Hansa Biopharma's long position.| GomSpace Group vs. Ambu AS | GomSpace Group vs. Bavarian Nordic | GomSpace Group vs. Fingerprint Cards AB | GomSpace Group vs. Zealand Pharma AS |
| Hansa Biopharma vs. Oncopeptides AB | Hansa Biopharma vs. ExpreS2ion Biotech Holding | Hansa Biopharma vs. BioInvent International AB | Hansa Biopharma vs. Zealand Pharma 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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