Correlation Between OSE Pharma and Sensorion
Can any of the company-specific risk be diversified away by investing in both OSE Pharma and Sensorion 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 OSE Pharma and Sensorion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSE Pharma SA and Sensorion SA, you can compare the effects of market volatilities on OSE Pharma and Sensorion 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 OSE Pharma with a short position of Sensorion. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSE Pharma and Sensorion.
Diversification Opportunities for OSE Pharma and Sensorion
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between OSE and Sensorion is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding OSE Pharma SA and Sensorion SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sensorion SA and OSE Pharma 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 OSE Pharma SA are associated (or correlated) with Sensorion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sensorion SA has no effect on the direction of OSE Pharma i.e., OSE Pharma and Sensorion go up and down completely randomly.
Pair Corralation between OSE Pharma and Sensorion
Assuming the 90 days trading horizon OSE Pharma SA is expected to generate 1.55 times more return on investment than Sensorion. However, OSE Pharma is 1.55 times more volatile than Sensorion SA. It trades about -0.02 of its potential returns per unit of risk. Sensorion SA is currently generating about -0.14 per unit of risk. If you would invest 770.00 in OSE Pharma SA on September 26, 2024 and sell it today you would lose (64.00) from holding OSE Pharma SA or give up 8.31% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
OSE Pharma SA vs. Sensorion SA
Performance |
Timeline |
OSE Pharma SA |
Sensorion SA |
OSE Pharma and Sensorion Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with OSE Pharma and Sensorion
The main advantage of trading using opposite OSE Pharma and Sensorion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSE Pharma position performs unexpectedly, Sensorion 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 Sensorion will offset losses from the drop in Sensorion's long position.OSE Pharma vs. Kalray SA | OSE Pharma vs. Biosynex | OSE Pharma vs. Eurobio Scientific SA | OSE Pharma vs. Quantum Genomics SA |
Sensorion vs. Kalray SA | Sensorion vs. Biosynex | Sensorion vs. Eurobio Scientific SA | Sensorion vs. OSE Pharma SA |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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