Correlation Between Addex Therapeutics and Warteck Invest

Can any of the company-specific risk be diversified away by investing in both Addex Therapeutics and Warteck Invest 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 Addex Therapeutics and Warteck Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Addex Therapeutics and Warteck Invest, you can compare the effects of market volatilities on Addex Therapeutics and Warteck Invest 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 Addex Therapeutics with a short position of Warteck Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addex Therapeutics and Warteck Invest.

Diversification Opportunities for Addex Therapeutics and Warteck Invest

-0.65

Correlation Coefficient

Addex Therapeutics  Warteck Invest

Excellent diversification

The 3 months correlation between Addex and Warteck is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Addex Therapeutics and Warteck Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Warteck Invest and Addex Therapeutics 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 Addex Therapeutics are associated (or correlated) with Warteck Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Warteck Invest has no effect on the direction of Addex Therapeutics i.e., Addex Therapeutics and Warteck Invest go up and down completely randomly.

Pair Corralation between Addex Therapeutics and Warteck Invest

Assuming the 90 days trading horizon Addex Therapeutics is expected to generate 17.9 times more return on investment than Warteck Invest. However, Addex Therapeutics is 17.9 times more volatile than Warteck Invest. It trades about 0.11 of its potential returns per unit of risk. Warteck Invest is currently generating about 0.0 per unit of risk. If you would invest  5.78  in Addex Therapeutics on October 24, 2024 and sell it today you would earn a total of  0.42  from holding Addex Therapeutics or generate 7.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	94.12%
Values	Daily Returns

Addex Therapeutics  vs.  Warteck Invest

Addex Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Addex Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Warteck Invest

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Warteck Invest are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Warteck Invest may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Addex Therapeutics and Warteck Invest

The main advantage of trading using opposite Addex Therapeutics and Warteck Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addex Therapeutics position performs unexpectedly, Warteck Invest 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 Warteck Invest will offset losses from the drop in Warteck Invest's long position.

The idea behind Addex Therapeutics and Warteck Invest pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.