Correlation Between Keros Therapeutics and Genscript Biotech

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Can any of the company-specific risk be diversified away by investing in both Keros Therapeutics and Genscript Biotech 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 Keros Therapeutics and Genscript Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keros Therapeutics and Genscript Biotech, you can compare the effects of market volatilities on Keros Therapeutics and Genscript Biotech 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 Keros Therapeutics with a short position of Genscript Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keros Therapeutics and Genscript Biotech.

Diversification Opportunities for Keros Therapeutics and Genscript Biotech

KerosGenscriptDiversified AwayKerosGenscriptDiversified Away100%
0.18
  Correlation Coefficient

Average diversification

The 3 months correlation between Keros and Genscript is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Keros Therapeutics and Genscript Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genscript Biotech and Keros 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 Keros Therapeutics are associated (or correlated) with Genscript Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genscript Biotech has no effect on the direction of Keros Therapeutics i.e., Keros Therapeutics and Genscript Biotech go up and down completely randomly.

Pair Corralation between Keros Therapeutics and Genscript Biotech

Given the investment horizon of 90 days Keros Therapeutics is expected to under-perform the Genscript Biotech. In addition to that, Keros Therapeutics is 4.74 times more volatile than Genscript Biotech. It trades about -0.07 of its total potential returns per unit of risk. Genscript Biotech is currently generating about -0.08 per unit of volatility. If you would invest  141.00  in Genscript Biotech on September 16, 2024 and sell it today you would lose (16.00) from holding Genscript Biotech or give up 11.35% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy98.48%
ValuesDaily Returns

Keros Therapeutics  vs.  Genscript Biotech

 Performance 
JavaScript chart by amCharts 3.21.15OctNov -10-50510152025
JavaScript chart by amCharts 3.21.15KROS GNNSF
       Timeline  
Keros Therapeutics 

Risk-Adjusted Performance

0 of 100

 
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Over the last 90 days Keros Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec203040506070
Genscript Biotech 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Genscript Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec1.251.31.351.41.451.51.55

Keros Therapeutics and Genscript Biotech Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-15.84-11.86-7.89-3.91-0.06143.627.3110.9914.68 0.020.040.060.08
JavaScript chart by amCharts 3.21.15KROS GNNSF
       Returns  

Pair Trading with Keros Therapeutics and Genscript Biotech

The main advantage of trading using opposite Keros Therapeutics and Genscript Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keros Therapeutics position performs unexpectedly, Genscript Biotech 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 Genscript Biotech will offset losses from the drop in Genscript Biotech's long position.
The idea behind Keros Therapeutics and Genscript Biotech 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.

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