Correlation Between Genmab AS and PFA Invest

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

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

Diversification Opportunities for Genmab AS and PFA Invest

0.14

Correlation Coefficient

Genmab AS  PFA Invest

Average diversification

The 3 months correlation between Genmab and PFA is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Genmab AS and PFA Invest Kreditobligationer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PFA Invest Kreditobl and Genmab AS 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 Genmab AS are associated (or correlated) with PFA Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PFA Invest Kreditobl has no effect on the direction of Genmab AS i.e., Genmab AS and PFA Invest go up and down completely randomly.

Pair Corralation between Genmab AS and PFA Invest

Assuming the 90 days trading horizon Genmab AS is expected to under-perform the PFA Invest. In addition to that, Genmab AS is 19.01 times more volatile than PFA Invest Kreditobligationer. It trades about -0.04 of its total potential returns per unit of risk. PFA Invest Kreditobligationer is currently generating about 0.06 per unit of volatility. If you would invest  10,567  in PFA Invest Kreditobligationer on December 30, 2024 and sell it today you would earn a total of  53.00  from holding PFA Invest Kreditobligationer or generate 0.5% return on investment over 90 days.

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

Genmab AS  vs.  PFA Invest Kreditobligationer

Genmab AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genmab AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

PFA Invest Kreditobl

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PFA Invest Kreditobligationer are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong forward indicators, PFA Invest is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Genmab AS and PFA Invest

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

The idea behind Genmab AS and PFA Invest Kreditobligationer 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.

Check out your portfolio center.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.