Correlation Between Oncopeptides and Zealand Pharma
Can any of the company-specific risk be diversified away by investing in both Oncopeptides and Zealand 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 Oncopeptides and Zealand Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oncopeptides AB and Zealand Pharma AS, you can compare the effects of market volatilities on Oncopeptides and Zealand 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 Oncopeptides with a short position of Zealand Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oncopeptides and Zealand Pharma.
Diversification Opportunities for Oncopeptides and Zealand Pharma
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oncopeptides and Zealand is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Oncopeptides AB and Zealand Pharma AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zealand Pharma AS 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 Zealand Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zealand Pharma AS has no effect on the direction of Oncopeptides i.e., Oncopeptides and Zealand Pharma go up and down completely randomly.
Pair Corralation between Oncopeptides and Zealand Pharma
Assuming the 90 days trading horizon Oncopeptides AB is expected to under-perform the Zealand Pharma. In addition to that, Oncopeptides is 1.54 times more volatile than Zealand Pharma AS. It trades about -0.11 of its total potential returns per unit of risk. Zealand Pharma AS is currently generating about 0.02 per unit of volatility. If you would invest 72,800 in Zealand Pharma AS on November 2, 2024 and sell it today you would earn a total of 350.00 from holding Zealand Pharma AS or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Oncopeptides AB vs. Zealand Pharma AS
Performance |
| Timeline |
| Oncopeptides AB |
| Zealand Pharma AS |
Oncopeptides and Zealand Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oncopeptides and Zealand Pharma
The main advantage of trading using opposite Oncopeptides and Zealand Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oncopeptides position performs unexpectedly, Zealand 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 Zealand Pharma will offset losses from the drop in Zealand Pharma's long position.| Oncopeptides vs. Hansa Biopharma AB | Oncopeptides vs. BioArctic AB | Oncopeptides vs. Sinch AB | Oncopeptides vs. Cantargia AB |
| Zealand Pharma vs. Bavarian Nordic | Zealand Pharma vs. Ambu AS | Zealand Pharma vs. Genmab AS | Zealand Pharma vs. ALK Abell AS |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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