Correlation Between Nykode Therapeutics and Ultimovacs ASA
Can any of the company-specific risk be diversified away by investing in both Nykode Therapeutics and Ultimovacs ASA 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 Nykode Therapeutics and Ultimovacs ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nykode Therapeutics ASA and Ultimovacs ASA, you can compare the effects of market volatilities on Nykode Therapeutics and Ultimovacs ASA 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 Nykode Therapeutics with a short position of Ultimovacs ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nykode Therapeutics and Ultimovacs ASA.
Diversification Opportunities for Nykode Therapeutics and Ultimovacs ASA
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nykode and Ultimovacs is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Nykode Therapeutics ASA and Ultimovacs ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultimovacs ASA and Nykode Therapeutics 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 Nykode Therapeutics ASA are associated (or correlated) with Ultimovacs ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultimovacs ASA has no effect on the direction of Nykode Therapeutics i.e., Nykode Therapeutics and Ultimovacs ASA go up and down completely randomly.
Pair Corralation between Nykode Therapeutics and Ultimovacs ASA
Assuming the 90 days trading horizon Nykode Therapeutics ASA is expected to under-perform the Ultimovacs ASA. In addition to that, Nykode Therapeutics is 1.1 times more volatile than Ultimovacs ASA. It trades about -0.19 of its total potential returns per unit of risk. Ultimovacs ASA is currently generating about 0.1 per unit of volatility. If you would invest 183.00 in Ultimovacs ASA on August 29, 2024 and sell it today you would earn a total of 24.00 from holding Ultimovacs ASA or generate 13.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nykode Therapeutics ASA vs. Ultimovacs ASA
Performance |
| Timeline |
| Nykode Therapeutics ASA |
| Ultimovacs ASA |
Nykode Therapeutics and Ultimovacs ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nykode Therapeutics and Ultimovacs ASA
The main advantage of trading using opposite Nykode Therapeutics and Ultimovacs ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nykode Therapeutics position performs unexpectedly, Ultimovacs ASA 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 Ultimovacs ASA will offset losses from the drop in Ultimovacs ASA's long position.| Nykode Therapeutics vs. Equinor ASA | Nykode Therapeutics vs. DnB ASA | Nykode Therapeutics vs. Aker BP ASA | Nykode Therapeutics vs. Telenor ASA |
| Ultimovacs ASA vs. Bergenbio ASA | Ultimovacs ASA vs. Nykode Therapeutics ASA | Ultimovacs ASA vs. PCI Biotech Holding |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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