Correlation Between Oncopeptides and Redsense Medical
Can any of the company-specific risk be diversified away by investing in both Oncopeptides and Redsense Medical 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 Oncopeptides and Redsense Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oncopeptides AB and Redsense Medical AB, you can compare the effects of market volatilities on Oncopeptides and Redsense Medical 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 Oncopeptides with a short position of Redsense Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oncopeptides and Redsense Medical.
Diversification Opportunities for Oncopeptides and Redsense Medical
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Oncopeptides and Redsense is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Oncopeptides AB and Redsense Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Redsense Medical and Oncopeptides 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 Oncopeptides AB are associated (or correlated) with Redsense Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Redsense Medical has no effect on the direction of Oncopeptides i.e., Oncopeptides and Redsense Medical go up and down completely randomly.
Pair Corralation between Oncopeptides and Redsense Medical
Assuming the 90 days trading horizon Oncopeptides AB is expected to under-perform the Redsense Medical. In addition to that, Oncopeptides is 1.18 times more volatile than Redsense Medical AB. It trades about -0.05 of its total potential returns per unit of risk. Redsense Medical AB is currently generating about 0.01 per unit of volatility. If you would invest 896.00 in Redsense Medical AB on September 12, 2024 and sell it today you would lose (240.00) from holding Redsense Medical AB or give up 26.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Oncopeptides AB vs. Redsense Medical AB
Performance |
| Timeline |
| Oncopeptides AB |
| Redsense Medical |
Oncopeptides and Redsense Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oncopeptides and Redsense Medical
The main advantage of trading using opposite Oncopeptides and Redsense Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oncopeptides position performs unexpectedly, Redsense Medical 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 Redsense Medical will offset losses from the drop in Redsense Medical's long position.| Oncopeptides vs. Hansa Biopharma AB | Oncopeptides vs. BioArctic AB | Oncopeptides vs. Sinch AB | Oncopeptides vs. Cantargia AB |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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