Correlation Between Senseonics Holdings and Cerus
Can any of the company-specific risk be diversified away by investing in both Senseonics Holdings and Cerus 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 Senseonics Holdings and Cerus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senseonics Holdings and Cerus, you can compare the effects of market volatilities on Senseonics Holdings and Cerus 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 Senseonics Holdings with a short position of Cerus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senseonics Holdings and Cerus.
Diversification Opportunities for Senseonics Holdings and Cerus
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Senseonics and Cerus is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Senseonics Holdings and Cerus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cerus and Senseonics Holdings 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 Senseonics Holdings are associated (or correlated) with Cerus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cerus has no effect on the direction of Senseonics Holdings i.e., Senseonics Holdings and Cerus go up and down completely randomly.
Pair Corralation between Senseonics Holdings and Cerus
Given the investment horizon of 90 days Senseonics Holdings is expected to under-perform the Cerus. But the stock apears to be less risky and, when comparing its historical volatility, Senseonics Holdings is 1.03 times less risky than Cerus. The stock trades about -0.01 of its potential returns per unit of risk. The Cerus is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 225.00 in Cerus on September 20, 2024 and sell it today you would lose (67.00) from holding Cerus or give up 29.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senseonics Holdings vs. Cerus
Performance |
| Timeline |
| Senseonics Holdings |
| Cerus |
Senseonics Holdings and Cerus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senseonics Holdings and Cerus
The main advantage of trading using opposite Senseonics Holdings and Cerus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senseonics Holdings position performs unexpectedly, Cerus 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 Cerus will offset losses from the drop in Cerus' long position.| Senseonics Holdings vs. Insulet | Senseonics Holdings vs. Tandem Diabetes Care | Senseonics Holdings vs. Abbott Laboratories | Senseonics Holdings vs. Align Technology |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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