Correlation Between Eterna Therapeutics and Serina Therapeutics
Can any of the company-specific risk be diversified away by investing in both Eterna Therapeutics and Serina Therapeutics 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 Eterna Therapeutics and Serina Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eterna Therapeutics and Serina Therapeutics, you can compare the effects of market volatilities on Eterna Therapeutics and Serina Therapeutics 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 Eterna Therapeutics with a short position of Serina Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eterna Therapeutics and Serina Therapeutics.
Diversification Opportunities for Eterna Therapeutics and Serina Therapeutics
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eterna and Serina is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Eterna Therapeutics and Serina Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Serina Therapeutics and Eterna 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 Eterna Therapeutics are associated (or correlated) with Serina Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Serina Therapeutics has no effect on the direction of Eterna Therapeutics i.e., Eterna Therapeutics and Serina Therapeutics go up and down completely randomly.
Pair Corralation between Eterna Therapeutics and Serina Therapeutics
Given the investment horizon of 90 days Eterna Therapeutics is expected to under-perform the Serina Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Eterna Therapeutics is 1.24 times less risky than Serina Therapeutics. The stock trades about -0.22 of its potential returns per unit of risk. The Serina Therapeutics is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 824.00 in Serina Therapeutics on September 19, 2024 and sell it today you would lose (302.00) from holding Serina Therapeutics or give up 36.65% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Eterna Therapeutics vs. Serina Therapeutics
Performance |
Timeline |
Eterna Therapeutics |
Serina Therapeutics |
Eterna Therapeutics and Serina Therapeutics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eterna Therapeutics and Serina Therapeutics
The main advantage of trading using opposite Eterna Therapeutics and Serina Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eterna Therapeutics position performs unexpectedly, Serina Therapeutics 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 Serina Therapeutics will offset losses from the drop in Serina Therapeutics' long position.Eterna Therapeutics vs. Arcus Biosciences | Eterna Therapeutics vs. Cullinan Oncology LLC | Eterna Therapeutics vs. Annexon | Eterna Therapeutics vs. Structure Therapeutics American |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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