Correlation Between Zealand Pharma and Senzime AB
Can any of the company-specific risk be diversified away by investing in both Zealand Pharma and Senzime AB 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 Zealand Pharma and Senzime AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zealand Pharma AS and Senzime AB, you can compare the effects of market volatilities on Zealand Pharma and Senzime AB 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 Zealand Pharma with a short position of Senzime AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zealand Pharma and Senzime AB.
Diversification Opportunities for Zealand Pharma and Senzime AB
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zealand and Senzime is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Zealand Pharma AS and Senzime AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senzime AB and Zealand Pharma 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 Zealand Pharma AS are associated (or correlated) with Senzime AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senzime AB has no effect on the direction of Zealand Pharma i.e., Zealand Pharma and Senzime AB go up and down completely randomly.
Pair Corralation between Zealand Pharma and Senzime AB
Assuming the 90 days trading horizon Zealand Pharma AS is expected to generate 0.81 times more return on investment than Senzime AB. However, Zealand Pharma AS is 1.23 times less risky than Senzime AB. It trades about 0.09 of its potential returns per unit of risk. Senzime AB is currently generating about 0.01 per unit of risk. If you would invest 21,300 in Zealand Pharma AS on September 1, 2024 and sell it today you would earn a total of 51,700 from holding Zealand Pharma AS or generate 242.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.13% |
| Values | Daily Returns |
Zealand Pharma AS vs. Senzime AB
Performance |
| Timeline |
| Zealand Pharma AS |
| Senzime AB |
Zealand Pharma and Senzime AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zealand Pharma and Senzime AB
The main advantage of trading using opposite Zealand Pharma and Senzime AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zealand Pharma position performs unexpectedly, Senzime AB 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 Senzime AB will offset losses from the drop in Senzime AB's long position.| Zealand Pharma vs. Bavarian Nordic | Zealand Pharma vs. Ambu AS | Zealand Pharma vs. Genmab AS | Zealand Pharma vs. ALK Abell AS |
| Senzime AB vs. C Rad AB | Senzime AB vs. XSpray Pharma AB | Senzime AB vs. Xbrane Biopharma AB | Senzime AB vs. Episurf Medical AB |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |