Correlation Between Candel Therapeutics and Genmab AS

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

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

Diversification Opportunities for Candel Therapeutics and Genmab AS

0.8

Correlation Coefficient

Candel Therapeutics  Genmab AS

Very poor diversification

The 3 months correlation between Candel and Genmab is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Candel Therapeutics and Genmab AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genmab AS and Candel 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 Candel Therapeutics are associated (or correlated) with Genmab AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genmab AS has no effect on the direction of Candel Therapeutics i.e., Candel Therapeutics and Genmab AS go up and down completely randomly.

Pair Corralation between Candel Therapeutics and Genmab AS

Given the investment horizon of 90 days Candel Therapeutics is expected to generate 6.46 times more return on investment than Genmab AS. However, Candel Therapeutics is 6.46 times more volatile than Genmab AS. It trades about 0.05 of its potential returns per unit of risk. Genmab AS is currently generating about -0.22 per unit of risk. If you would invest  701.00  in Candel Therapeutics on September 13, 2024 and sell it today you would earn a total of  74.00  from holding Candel Therapeutics or generate 10.56% return on investment over 90 days.

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

Candel Therapeutics  vs.  Genmab AS

Candel Therapeutics

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Candel Therapeutics are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady fundamental indicators, Candel Therapeutics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Genmab AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genmab AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Candel Therapeutics and Genmab AS

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

The idea behind Candel Therapeutics and Genmab AS 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.