Correlation Between Histogen and Kineta

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

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

Diversification Opportunities for Histogen and Kineta

0.06

Correlation Coefficient

Histogen  Kineta

Significant diversification

The 3 months correlation between Histogen and Kineta is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Histogen and Kineta Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kineta Inc and Histogen 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 Histogen are associated (or correlated) with Kineta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kineta Inc has no effect on the direction of Histogen i.e., Histogen and Kineta go up and down completely randomly.

Pair Corralation between Histogen and Kineta

Given the investment horizon of 90 days Histogen is expected to generate 1.48 times more return on investment than Kineta. However, Histogen is 1.48 times more volatile than Kineta Inc. It trades about 0.02 of its potential returns per unit of risk. Kineta Inc is currently generating about -0.02 per unit of risk. If you would invest  79.00  in Histogen on September 18, 2024 and sell it today you would lose (76.23) from holding Histogen or give up 96.49% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Histogen  vs.  Kineta Inc

Histogen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Histogen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Kineta Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kineta Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Kineta is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Histogen and Kineta

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

The idea behind Histogen and Kineta Inc 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.