Correlation Between PepGen and Safeplus International

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

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

Diversification Opportunities for PepGen and Safeplus International

-0.67

Correlation Coefficient

PepGen  Safeplus International

Excellent diversification

The 3 months correlation between PepGen and Safeplus is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding PepGen and Safeplus International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safeplus International and PepGen 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 PepGen are associated (or correlated) with Safeplus International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safeplus International has no effect on the direction of PepGen i.e., PepGen and Safeplus International go up and down completely randomly.

Pair Corralation between PepGen and Safeplus International

Given the investment horizon of 90 days PepGen is expected to under-perform the Safeplus International. In addition to that, PepGen is 9.64 times more volatile than Safeplus International Holdings. It trades about -0.04 of its total potential returns per unit of risk. Safeplus International Holdings is currently generating about 0.04 per unit of volatility. If you would invest  1,667  in Safeplus International Holdings on December 29, 2024 and sell it today you would earn a total of  53.00  from holding Safeplus International Holdings or generate 3.18% return on investment over 90 days.

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

PepGen  vs.  Safeplus International Holding

PepGen

Risk-Adjusted Performance

Very Weak

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

Safeplus International

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Safeplus International Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Safeplus International is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with PepGen and Safeplus International

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

The idea behind PepGen and Safeplus International Holdings 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..