Correlation Between Relief Therapeutics and Banque Cantonale

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

By analyzing existing cross correlation between Relief Therapeutics Holding and Banque Cantonale de, you can compare the effects of market volatilities on Relief Therapeutics and Banque Cantonale 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 Relief Therapeutics with a short position of Banque Cantonale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Relief Therapeutics and Banque Cantonale.

Diversification Opportunities for Relief Therapeutics and Banque Cantonale

-0.45

Correlation Coefficient

Relief Therapeutics  Banque Cantonale

Very good diversification

The 3 months correlation between Relief and Banque is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Relief Therapeutics Holding and Banque Cantonale de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banque Cantonale and Relief Therapeutics 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 Relief Therapeutics Holding are associated (or correlated) with Banque Cantonale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banque Cantonale has no effect on the direction of Relief Therapeutics i.e., Relief Therapeutics and Banque Cantonale go up and down completely randomly.

Pair Corralation between Relief Therapeutics and Banque Cantonale

Assuming the 90 days trading horizon Relief Therapeutics Holding is expected to under-perform the Banque Cantonale. In addition to that, Relief Therapeutics is 6.5 times more volatile than Banque Cantonale de. It trades about -0.09 of its total potential returns per unit of risk. Banque Cantonale de is currently generating about 0.04 per unit of volatility. If you would invest  25,800  in Banque Cantonale de on October 21, 2024 and sell it today you would earn a total of  500.00  from holding Banque Cantonale de or generate 1.94% return on investment over 90 days.

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

Relief Therapeutics Holding  vs.  Banque Cantonale de

Relief Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Relief Therapeutics Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical and fundamental indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Banque Cantonale

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Banque Cantonale de are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Banque Cantonale is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Relief Therapeutics and Banque Cantonale

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

The idea behind Relief Therapeutics Holding and Banque Cantonale de 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.