Correlation Between MediciNova and Genfit
Can any of the company-specific risk be diversified away by investing in both MediciNova and Genfit 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 MediciNova and Genfit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MediciNova and Genfit, you can compare the effects of market volatilities on MediciNova and Genfit 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 MediciNova with a short position of Genfit. Check out your portfolio center. Please also check ongoing floating volatility patterns of MediciNova and Genfit.
Diversification Opportunities for MediciNova and Genfit
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MediciNova and Genfit is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding MediciNova and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and MediciNova 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 MediciNova are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of MediciNova i.e., MediciNova and Genfit go up and down completely randomly.
Pair Corralation between MediciNova and Genfit
Given the investment horizon of 90 days MediciNova is expected to under-perform the Genfit. But the stock apears to be less risky and, when comparing its historical volatility, MediciNova is 1.03 times less risky than Genfit. The stock trades about -0.2 of its potential returns per unit of risk. The Genfit is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 405.00 in Genfit on December 2, 2024 and sell it today you would lose (58.00) from holding Genfit or give up 14.32% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
MediciNova vs. Genfit
Performance |
Timeline |
MediciNova |
Genfit |
MediciNova and Genfit Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MediciNova and Genfit
The main advantage of trading using opposite MediciNova and Genfit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MediciNova position performs unexpectedly, Genfit 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 Genfit will offset losses from the drop in Genfit's long position.MediciNova vs. Aerovate Therapeutics | MediciNova vs. Adagene | MediciNova vs. Acrivon Therapeutics, Common | MediciNova vs. Rezolute |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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