Correlation Between Iovance Biotherapeutics and Sera Prognostics
Can any of the company-specific risk be diversified away by investing in both Iovance Biotherapeutics and Sera Prognostics 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 Iovance Biotherapeutics and Sera Prognostics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iovance Biotherapeutics and Sera Prognostics, you can compare the effects of market volatilities on Iovance Biotherapeutics and Sera Prognostics 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 Iovance Biotherapeutics with a short position of Sera Prognostics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iovance Biotherapeutics and Sera Prognostics.
Diversification Opportunities for Iovance Biotherapeutics and Sera Prognostics
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Iovance and Sera is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Iovance Biotherapeutics and Sera Prognostics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sera Prognostics and Iovance Biotherapeutics 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 Iovance Biotherapeutics are associated (or correlated) with Sera Prognostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sera Prognostics has no effect on the direction of Iovance Biotherapeutics i.e., Iovance Biotherapeutics and Sera Prognostics go up and down completely randomly.
Pair Corralation between Iovance Biotherapeutics and Sera Prognostics
Given the investment horizon of 90 days Iovance Biotherapeutics is expected to under-perform the Sera Prognostics. But the stock apears to be less risky and, when comparing its historical volatility, Iovance Biotherapeutics is 1.29 times less risky than Sera Prognostics. The stock trades about -0.13 of its potential returns per unit of risk. The Sera Prognostics is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 697.00 in Sera Prognostics on September 14, 2024 and sell it today you would earn a total of 157.00 from holding Sera Prognostics or generate 22.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Iovance Biotherapeutics vs. Sera Prognostics
Performance |
Timeline |
Iovance Biotherapeutics |
Sera Prognostics |
Iovance Biotherapeutics and Sera Prognostics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Iovance Biotherapeutics and Sera Prognostics
The main advantage of trading using opposite Iovance Biotherapeutics and Sera Prognostics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iovance Biotherapeutics position performs unexpectedly, Sera Prognostics 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 Sera Prognostics will offset losses from the drop in Sera Prognostics' long position.Iovance Biotherapeutics vs. PTC Therapeutics | Iovance Biotherapeutics vs. Krystal Biotech | Iovance Biotherapeutics vs. Sarepta Therapeutics | Iovance Biotherapeutics vs. Madrigal Pharmaceuticals |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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