Correlation Between Genenta Science and NovAccess Global

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

By analyzing existing cross correlation between Genenta Science SpA and NovAccess Global, you can compare the effects of market volatilities on Genenta Science and NovAccess Global 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 Genenta Science with a short position of NovAccess Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genenta Science and NovAccess Global.

Diversification Opportunities for Genenta Science and NovAccess Global

0.83

Correlation Coefficient

Genenta Science  NovAccess Global

Very poor diversification

The 3 months correlation between Genenta and NovAccess is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Genenta Science SpA and NovAccess Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NovAccess Global and Genenta Science 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 Genenta Science SpA are associated (or correlated) with NovAccess Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NovAccess Global has no effect on the direction of Genenta Science i.e., Genenta Science and NovAccess Global go up and down completely randomly.

Pair Corralation between Genenta Science and NovAccess Global

Given the investment horizon of 90 days Genenta Science SpA is expected to under-perform the NovAccess Global. But the stock apears to be less risky and, when comparing its historical volatility, Genenta Science SpA is 6.29 times less risky than NovAccess Global. The stock trades about -0.1 of its potential returns per unit of risk. The NovAccess Global is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  0.90  in NovAccess Global on December 4, 2024 and sell it today you would lose (0.86) from holding NovAccess Global or give up 95.56% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.16%
Values	Daily Returns

Genenta Science SpA  vs.  NovAccess Global

Genenta Science SpA

Risk-Adjusted Performance

Very Weak

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

NovAccess Global

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NovAccess Global are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, NovAccess Global showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Genenta Science and NovAccess Global

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

The idea behind Genenta Science SpA and NovAccess Global 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..