Correlation Between Addex Therapeutics and Surrozen

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

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

Diversification Opportunities for Addex Therapeutics and Surrozen

0.25

Correlation Coefficient

Addex Therapeutics  Surrozen

Modest diversification

The 3 months correlation between Addex and Surrozen is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Addex Therapeutics and Surrozen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surrozen 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 Surrozen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surrozen has no effect on the direction of Addex Therapeutics i.e., Addex Therapeutics and Surrozen go up and down completely randomly.

Pair Corralation between Addex Therapeutics and Surrozen

Given the investment horizon of 90 days Addex Therapeutics is expected to generate 2.98 times less return on investment than Surrozen. But when comparing it to its historical volatility, Addex Therapeutics is 1.08 times less risky than Surrozen. It trades about 0.02 of its potential returns per unit of risk. Surrozen is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,057  in Surrozen on December 20, 2024 and sell it today you would earn a total of  75.00  from holding Surrozen or generate 7.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Addex Therapeutics  vs.  Surrozen

Addex Therapeutics

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Addex Therapeutics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Addex Therapeutics may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Surrozen

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Surrozen are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Surrozen displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Addex Therapeutics and Surrozen

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

The idea behind Addex Therapeutics and Surrozen 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.