Correlation Between Molecular Partners and Genfit
Can any of the company-specific risk be diversified away by investing in both Molecular Partners and Genfit 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 Genfit 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 Genfit, you can compare the effects of market volatilities on Molecular Partners and Genfit 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 Genfit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molecular Partners and Genfit.
Diversification Opportunities for Molecular Partners and Genfit
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Molecular and Genfit is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Molecular Partners AG and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit 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 Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of Molecular Partners i.e., Molecular Partners and Genfit go up and down completely randomly.
Pair Corralation between Molecular Partners and Genfit
Given the investment horizon of 90 days Molecular Partners AG is expected to generate 1.37 times more return on investment than Genfit. However, Molecular Partners is 1.37 times more volatile than Genfit. It trades about -0.04 of its potential returns per unit of risk. Genfit is currently generating about -0.19 per unit of risk. If you would invest 606.00 in Molecular Partners AG on November 2, 2024 and sell it today you would lose (83.00) from holding Molecular Partners AG or give up 13.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Molecular Partners AG vs. Genfit
Performance |
| Timeline |
| Molecular Partners |
| Genfit |
Molecular Partners and Genfit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molecular Partners and Genfit
The main advantage of trading using opposite Molecular Partners and Genfit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molecular Partners position performs unexpectedly, Genfit 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 Genfit will offset losses from the drop in Genfit's long position.| Molecular Partners vs. Mineralys Therapeutics, Common | Molecular Partners vs. AN2 Therapeutics | Molecular Partners vs. Pharvaris BV | Molecular Partners vs. PepGen |
| Genfit vs. HCW Biologics | Genfit vs. Molecular Partners AG | Genfit vs. MediciNova | Genfit vs. Anebulo 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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