Correlation Between Avax Techs and Fennec Pharmaceuticals

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

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

Diversification Opportunities for Avax Techs and Fennec Pharmaceuticals

0.0

Correlation Coefficient

Avax Techs  Fennec Pharmaceuticals

Pay attention - limited upside

The 3 months correlation between Avax and Fennec is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Avax Techs and Fennec Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fennec Pharmaceuticals and Avax Techs 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 Avax Techs 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 Avax Techs i.e., Avax Techs and Fennec Pharmaceuticals go up and down completely randomly.

Pair Corralation between Avax Techs and Fennec Pharmaceuticals

Given the investment horizon of 90 days Avax Techs is expected to generate 46.2 times more return on investment than Fennec Pharmaceuticals. However, Avax Techs is 46.2 times more volatile than Fennec Pharmaceuticals. It trades about 0.13 of its potential returns per unit of risk. Fennec Pharmaceuticals is currently generating about 0.04 per unit of risk. If you would invest  0.00  in Avax Techs on December 27, 2024 and sell it today you would earn a total of  0.00  from holding Avax Techs or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Avax Techs  vs.  Fennec Pharmaceuticals

Avax Techs

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Avax Techs are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Avax Techs unveiled solid returns over the last few months and may actually be approaching a breakup point.

Fennec Pharmaceuticals

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fennec Pharmaceuticals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Fennec Pharmaceuticals is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Avax Techs and Fennec Pharmaceuticals

The main advantage of trading using opposite Avax Techs and Fennec Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avax Techs 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.

The idea behind Avax Techs and Fennec Pharmaceuticals 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.