Correlation Between Jasper Therapeutics and Awakn Life

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

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

Diversification Opportunities for Jasper Therapeutics and Awakn Life

0.24

Correlation Coefficient

Jasper Therapeutics  Awakn Life

Modest diversification

The 3 months correlation between Jasper and Awakn is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Jasper Therapeutics and Awakn Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Awakn Life Sciences and Jasper 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 Jasper Therapeutics are associated (or correlated) with Awakn Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Awakn Life Sciences has no effect on the direction of Jasper Therapeutics i.e., Jasper Therapeutics and Awakn Life go up and down completely randomly.

Pair Corralation between Jasper Therapeutics and Awakn Life

Assuming the 90 days horizon Jasper Therapeutics is expected to generate 0.67 times more return on investment than Awakn Life. However, Jasper Therapeutics is 1.48 times less risky than Awakn Life. It trades about 0.06 of its potential returns per unit of risk. Awakn Life Sciences is currently generating about 0.02 per unit of risk. If you would invest  20.00  in Jasper Therapeutics on September 14, 2024 and sell it today you would earn a total of  2.20  from holding Jasper Therapeutics or generate 11.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	79.69%
Values	Daily Returns

Jasper Therapeutics  vs.  Awakn Life Sciences

Jasper Therapeutics

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jasper Therapeutics are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Jasper Therapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Awakn Life Sciences

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Awakn Life Sciences are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Awakn Life reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jasper Therapeutics and Awakn Life

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

The idea behind Jasper Therapeutics and Awakn Life Sciences 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.