Correlation Between Molecular Partners and DBV Technologies
Can any of the company-specific risk be diversified away by investing in both Molecular Partners and DBV Technologies 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 Molecular Partners and DBV Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molecular Partners AG and DBV Technologies, you can compare the effects of market volatilities on Molecular Partners and DBV Technologies 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 Molecular Partners with a short position of DBV Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molecular Partners and DBV Technologies.
Diversification Opportunities for Molecular Partners and DBV Technologies
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Molecular and DBV is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Molecular Partners AG and DBV Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBV Technologies and Molecular Partners 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 Molecular Partners AG are associated (or correlated) with DBV Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBV Technologies has no effect on the direction of Molecular Partners i.e., Molecular Partners and DBV Technologies go up and down completely randomly.
Pair Corralation between Molecular Partners and DBV Technologies
Given the investment horizon of 90 days Molecular Partners AG is expected to generate 1.47 times more return on investment than DBV Technologies. However, Molecular Partners is 1.47 times more volatile than DBV Technologies. It trades about 0.05 of its potential returns per unit of risk. DBV Technologies is currently generating about -0.04 per unit of risk. If you would invest 448.00 in Molecular Partners AG on September 2, 2024 and sell it today you would earn a total of 134.00 from holding Molecular Partners AG or generate 29.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Molecular Partners AG vs. DBV Technologies
Performance |
| Timeline |
| Molecular Partners |
| DBV Technologies |
Molecular Partners and DBV Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molecular Partners and DBV Technologies
The main advantage of trading using opposite Molecular Partners and DBV Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molecular Partners position performs unexpectedly, DBV Technologies 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 DBV Technologies will offset losses from the drop in DBV Technologies' long position.| Molecular Partners vs. Tff Pharmaceuticals | Molecular Partners vs. Eliem Therapeutics | Molecular Partners vs. Inhibrx | Molecular Partners vs. Enliven Therapeutics |
| DBV Technologies vs. Oric Pharmaceuticals | DBV Technologies vs. Lyra Therapeutics | DBV Technologies vs. Inhibrx | DBV Technologies vs. ESSA 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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