Correlation Between Camurus AB and XSpray Pharma

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

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

Diversification Opportunities for Camurus AB and XSpray Pharma

0.66

Correlation Coefficient

Camurus AB  XSpray Pharma

Poor diversification

The 3 months correlation between Camurus and XSpray is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Camurus AB and XSpray Pharma AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XSpray Pharma AB and Camurus AB 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 Camurus AB are associated (or correlated) with XSpray Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XSpray Pharma AB has no effect on the direction of Camurus AB i.e., Camurus AB and XSpray Pharma go up and down completely randomly.

Pair Corralation between Camurus AB and XSpray Pharma

Assuming the 90 days trading horizon Camurus AB is expected to generate 1.47 times less return on investment than XSpray Pharma. But when comparing it to its historical volatility, Camurus AB is 1.05 times less risky than XSpray Pharma. It trades about 0.11 of its potential returns per unit of risk. XSpray Pharma AB is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  3,650  in XSpray Pharma AB on April 20, 2025 and sell it today you would earn a total of  1,480  from holding XSpray Pharma AB or generate 40.55% return on investment over 90 days.

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

Camurus AB  vs.  XSpray Pharma AB

Camurus AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Camurus AB are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Camurus AB unveiled solid returns over the last few months and may actually be approaching a breakup point.

XSpray Pharma AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in XSpray Pharma AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, XSpray Pharma sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Camurus AB and XSpray Pharma

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

The idea behind Camurus AB and XSpray Pharma AB 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 Stocks Directory module to find actively traded stocks across global markets.