Correlation Between Exor NV and Galapagos

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

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

Diversification Opportunities for Exor NV and Galapagos

0.29

Correlation Coefficient

Exor NV  Galapagos

Modest diversification

The 3 months correlation between Exor and Galapagos is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Exor NV and Galapagos NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galapagos NV and Exor NV 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 Exor NV are associated (or correlated) with Galapagos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galapagos NV has no effect on the direction of Exor NV i.e., Exor NV and Galapagos go up and down completely randomly.

Pair Corralation between Exor NV and Galapagos

Assuming the 90 days trading horizon Exor NV is expected to generate 2.55 times less return on investment than Galapagos. But when comparing it to its historical volatility, Exor NV is 1.38 times less risky than Galapagos. It trades about 0.11 of its potential returns per unit of risk. Galapagos NV is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  2,298  in Galapagos NV on April 24, 2025 and sell it today you would earn a total of  494.00  from holding Galapagos NV or generate 21.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Exor NV  vs.  Galapagos NV

Exor NV

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Exor NV are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Exor NV may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Galapagos NV

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Galapagos NV are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Galapagos unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Exor NV and Galapagos

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

The idea behind Exor NV and Galapagos NV 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..