Correlation Between HCW Biologics and Genmab AS
Can any of the company-specific risk be diversified away by investing in both HCW Biologics and Genmab 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 HCW Biologics and Genmab AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HCW Biologics and Genmab AS, you can compare the effects of market volatilities on HCW Biologics and Genmab 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 HCW Biologics with a short position of Genmab AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of HCW Biologics and Genmab AS.
Diversification Opportunities for HCW Biologics and Genmab AS
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between HCW and Genmab is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding HCW Biologics and Genmab AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genmab AS and HCW Biologics 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 HCW Biologics are associated (or correlated) with Genmab AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genmab AS has no effect on the direction of HCW Biologics i.e., HCW Biologics and Genmab AS go up and down completely randomly.
Pair Corralation between HCW Biologics and Genmab AS
Given the investment horizon of 90 days HCW Biologics is expected to generate 8.45 times more return on investment than Genmab AS. However, HCW Biologics is 8.45 times more volatile than Genmab AS. It trades about 0.02 of its potential returns per unit of risk. Genmab AS is currently generating about -0.08 per unit of risk. If you would invest 207.00 in HCW Biologics on August 26, 2024 and sell it today you would lose (130.00) from holding HCW Biologics or give up 62.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HCW Biologics vs. Genmab AS
Performance |
| Timeline |
| HCW Biologics |
| Genmab AS |
HCW Biologics and Genmab AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HCW Biologics and Genmab AS
The main advantage of trading using opposite HCW Biologics and Genmab AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HCW Biologics position performs unexpectedly, Genmab 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 Genmab AS will offset losses from the drop in Genmab AS's long position.| HCW Biologics vs. Anebulo Pharmaceuticals | HCW Biologics vs. Rezolute | HCW Biologics vs. Eliem Therapeutics | HCW Biologics vs. Molecular Partners AG |
| Genmab AS vs. Eliem Therapeutics | Genmab AS vs. HCW Biologics | Genmab AS vs. Scpharmaceuticals | Genmab AS vs. Milestone Pharmaceuticals |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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