Correlation Between Kineta and Theriva Biologics

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

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

Diversification Opportunities for Kineta and Theriva Biologics

-0.01

Correlation Coefficient

Kineta  Theriva Biologics

Good diversification

The 3 months correlation between Kineta and Theriva is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Kineta Inc and Theriva Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Theriva Biologics and Kineta 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 Kineta Inc are associated (or correlated) with Theriva Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Theriva Biologics has no effect on the direction of Kineta i.e., Kineta and Theriva Biologics go up and down completely randomly.

Pair Corralation between Kineta and Theriva Biologics

Allowing for the 90-day total investment horizon Kineta Inc is expected to generate 0.77 times more return on investment than Theriva Biologics. However, Kineta Inc is 1.3 times less risky than Theriva Biologics. It trades about -0.01 of its potential returns per unit of risk. Theriva Biologics is currently generating about -0.14 per unit of risk. If you would invest  57.00  in Kineta Inc on September 18, 2024 and sell it today you would lose (9.00) from holding Kineta Inc or give up 15.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	74.6%
Values	Daily Returns

Kineta Inc  vs.  Theriva Biologics

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.

Theriva Biologics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Theriva Biologics 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 fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Kineta and Theriva Biologics

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

The idea behind Kineta Inc and Theriva Biologics 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 Global Correlations module to find global opportunities by holding instruments from different markets.