Correlation Between Fennec Pharmaceuticals and Genelux Common

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

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

Diversification Opportunities for Fennec Pharmaceuticals and Genelux Common

-0.4

Correlation Coefficient

Fennec Pharmaceuticals  Genelux Common

Very good diversification

The 3 months correlation between Fennec and Genelux is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fennec Pharmaceuticals and Genelux Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genelux Common and Fennec Pharmaceuticals 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 Fennec Pharmaceuticals are associated (or correlated) with Genelux Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genelux Common has no effect on the direction of Fennec Pharmaceuticals i.e., Fennec Pharmaceuticals and Genelux Common go up and down completely randomly.

Pair Corralation between Fennec Pharmaceuticals and Genelux Common

Given the investment horizon of 90 days Fennec Pharmaceuticals is expected to under-perform the Genelux Common. But the stock apears to be less risky and, when comparing its historical volatility, Fennec Pharmaceuticals is 2.65 times less risky than Genelux Common. The stock trades about -0.13 of its potential returns per unit of risk. The Genelux Common is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  246.00  in Genelux Common on October 26, 2024 and sell it today you would earn a total of  90.00  from holding Genelux Common or generate 36.59% return on investment over 90 days.

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

Fennec Pharmaceuticals  vs.  Genelux Common

Fennec Pharmaceuticals

Risk-Adjusted Performance

9 of 100

OK

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

Genelux Common

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Genelux Common are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Genelux Common showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fennec Pharmaceuticals and Genelux Common

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

The idea behind Fennec Pharmaceuticals and Genelux Common 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.