Correlation Between IRLAB Therapeutics and Genovis AB

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

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

Diversification Opportunities for IRLAB Therapeutics and Genovis AB

-0.61

Correlation Coefficient

IRLAB Therapeutics  Genovis AB

Excellent diversification

The 3 months correlation between IRLAB and Genovis is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding IRLAB Therapeutics AB and Genovis AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genovis AB and IRLAB Therapeutics 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 IRLAB Therapeutics AB are associated (or correlated) with Genovis AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genovis AB has no effect on the direction of IRLAB Therapeutics i.e., IRLAB Therapeutics and Genovis AB go up and down completely randomly.

Pair Corralation between IRLAB Therapeutics and Genovis AB

Assuming the 90 days trading horizon IRLAB Therapeutics AB is expected to under-perform the Genovis AB. In addition to that, IRLAB Therapeutics is 2.07 times more volatile than Genovis AB. It trades about -0.16 of its total potential returns per unit of risk. Genovis AB is currently generating about 0.2 per unit of volatility. If you would invest  2,010  in Genovis AB on April 22, 2025 and sell it today you would earn a total of  775.00  from holding Genovis AB or generate 38.56% return on investment over 90 days.

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

IRLAB Therapeutics AB  vs.  Genovis AB

IRLAB Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days IRLAB Therapeutics AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Genovis AB

Risk-Adjusted Performance

Good

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

Pair Trading with IRLAB Therapeutics and Genovis AB

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

The idea behind IRLAB Therapeutics AB and Genovis 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.