Correlation Between XRP and Genmab AS
Can any of the company-specific risk be diversified away by investing in both XRP and Genmab AS 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 XRP and Genmab AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XRP and Genmab AS, you can compare the effects of market volatilities on XRP and Genmab AS 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 XRP with a short position of Genmab AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of XRP and Genmab AS.
Diversification Opportunities for XRP and Genmab AS
Very weak diversification
The 3 months correlation between XRP and Genmab is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding XRP and Genmab AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genmab AS and XRP 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 XRP are associated (or correlated) with Genmab AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genmab AS has no effect on the direction of XRP i.e., XRP and Genmab AS go up and down completely randomly.
Pair Corralation between XRP and Genmab AS
Assuming the 90 days trading horizon XRP is expected to under-perform the Genmab AS. In addition to that, XRP is 2.78 times more volatile than Genmab AS. It trades about -0.25 of its total potential returns per unit of risk. Genmab AS is currently generating about -0.02 per unit of volatility. If you would invest 200,900 in Genmab AS on January 20, 2024 and sell it today you would lose (1,450) from holding Genmab AS or give up 0.72% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 90.91% |
Values | Daily Returns |
XRP vs. Genmab AS
Performance |
Timeline |
XRP |
Genmab AS |
XRP and Genmab AS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with XRP and Genmab AS
The main advantage of trading using opposite XRP and Genmab AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XRP position performs unexpectedly, Genmab AS 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 Genmab AS will offset losses from the drop in Genmab AS's long position.The idea behind XRP and Genmab AS 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.Genmab AS vs. Ambu AS | Genmab AS vs. DSV Panalpina AS | Genmab AS vs. Bavarian Nordic | Genmab AS vs. GN Store Nord |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |