Correlation Between ProMIS Neurosciences and Fennec Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both ProMIS Neurosciences and Fennec Pharmaceuticals 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 ProMIS Neurosciences and Fennec Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProMIS Neurosciences and Fennec Pharmaceuticals, you can compare the effects of market volatilities on ProMIS Neurosciences and Fennec Pharmaceuticals 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 ProMIS Neurosciences with a short position of Fennec Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProMIS Neurosciences and Fennec Pharmaceuticals.
Diversification Opportunities for ProMIS Neurosciences and Fennec Pharmaceuticals
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProMIS and Fennec is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding ProMIS Neurosciences and Fennec Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fennec Pharmaceuticals and ProMIS Neurosciences 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 ProMIS Neurosciences are associated (or correlated) with Fennec Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fennec Pharmaceuticals has no effect on the direction of ProMIS Neurosciences i.e., ProMIS Neurosciences and Fennec Pharmaceuticals go up and down completely randomly.
Pair Corralation between ProMIS Neurosciences and Fennec Pharmaceuticals
Considering the 90-day investment horizon ProMIS Neurosciences is expected to under-perform the Fennec Pharmaceuticals. In addition to that, ProMIS Neurosciences is 1.8 times more volatile than Fennec Pharmaceuticals. It trades about -0.16 of its total potential returns per unit of risk. Fennec Pharmaceuticals is currently generating about 0.13 per unit of volatility. If you would invest 615.00 in Fennec Pharmaceuticals on November 4, 2024 and sell it today you would earn a total of 35.00 from holding Fennec Pharmaceuticals or generate 5.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProMIS Neurosciences vs. Fennec Pharmaceuticals
Performance |
| Timeline |
| ProMIS Neurosciences |
| Fennec Pharmaceuticals |
ProMIS Neurosciences and Fennec Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProMIS Neurosciences and Fennec Pharmaceuticals
The main advantage of trading using opposite ProMIS Neurosciences and Fennec Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProMIS Neurosciences position performs unexpectedly, Fennec Pharmaceuticals 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 Fennec Pharmaceuticals will offset losses from the drop in Fennec Pharmaceuticals' long position.| ProMIS Neurosciences vs. biOasis Technologies | ProMIS Neurosciences vs. Zenith Capital Corp | ProMIS Neurosciences vs. Hemogenyx Pharmaceuticals Plc | ProMIS Neurosciences vs. Fennec Pharmaceuticals |
| Fennec Pharmaceuticals vs. Molecular Partners AG | Fennec Pharmaceuticals vs. MediciNova | Fennec Pharmaceuticals vs. Anebulo Pharmaceuticals | Fennec Pharmaceuticals vs. Champions Oncology |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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