Correlation Between Incyte and Ascendis Pharma
Can any of the company-specific risk be diversified away by investing in both Incyte and Ascendis Pharma 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 Incyte and Ascendis Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Incyte and Ascendis Pharma AS, you can compare the effects of market volatilities on Incyte and Ascendis Pharma 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 Incyte with a short position of Ascendis Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Incyte and Ascendis Pharma.
Diversification Opportunities for Incyte and Ascendis Pharma
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Incyte and Ascendis is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Incyte and Ascendis Pharma AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascendis Pharma AS and Incyte 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 Incyte are associated (or correlated) with Ascendis Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascendis Pharma AS has no effect on the direction of Incyte i.e., Incyte and Ascendis Pharma go up and down completely randomly.
Pair Corralation between Incyte and Ascendis Pharma
Given the investment horizon of 90 days Incyte is expected to generate 0.65 times more return on investment than Ascendis Pharma. However, Incyte is 1.54 times less risky than Ascendis Pharma. It trades about 0.24 of its potential returns per unit of risk. Ascendis Pharma AS is currently generating about -0.16 per unit of risk. If you would invest 6,907 in Incyte on November 1, 2024 and sell it today you would earn a total of 465.00 from holding Incyte or generate 6.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Incyte vs. Ascendis Pharma AS
Performance |
| Timeline |
| Incyte |
| Ascendis Pharma AS |
Incyte and Ascendis Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Incyte and Ascendis Pharma
The main advantage of trading using opposite Incyte and Ascendis Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Incyte position performs unexpectedly, Ascendis Pharma 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 Ascendis Pharma will offset losses from the drop in Ascendis Pharma's long position.| Incyte vs. Alnylam Pharmaceuticals | Incyte vs. United Therapeutics | Incyte vs. Ultragenyx | Incyte vs. Apellis Pharmaceuticals |
| Ascendis Pharma vs. Apellis Pharmaceuticals | Ascendis Pharma vs. Akero Therapeutics | Ascendis Pharma vs. Blueprint Medicines Corp | Ascendis Pharma vs. Replimune Group |
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.
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