Correlation Between Onyx Acquisition and Genfit

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

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

Diversification Opportunities for Onyx Acquisition and Genfit

-0.42

Correlation Coefficient

Onyx Acquisition  Genfit

Very good diversification

The 3 months correlation between Onyx and Genfit is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Onyx Acquisition Co and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and Onyx Acquisition 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 Onyx Acquisition Co 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 Onyx Acquisition i.e., Onyx Acquisition and Genfit go up and down completely randomly.

Pair Corralation between Onyx Acquisition and Genfit

Assuming the 90 days horizon Onyx Acquisition Co is expected to generate 0.16 times more return on investment than Genfit. However, Onyx Acquisition Co is 6.11 times less risky than Genfit. It trades about 0.04 of its potential returns per unit of risk. Genfit is currently generating about -0.03 per unit of risk. If you would invest  1,121  in Onyx Acquisition Co on September 18, 2024 and sell it today you would earn a total of  10.00  from holding Onyx Acquisition Co or generate 0.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	58.73%
Values	Daily Returns

Onyx Acquisition Co  vs.  Genfit

Onyx Acquisition

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Onyx Acquisition Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Onyx Acquisition is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Genfit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genfit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Onyx Acquisition and Genfit

The main advantage of trading using opposite Onyx Acquisition and Genfit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Onyx Acquisition 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.

The idea behind Onyx Acquisition Co and Genfit 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.