Correlation Between Y MAbs and Sarepta Therapeutics

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

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

Diversification Opportunities for Y MAbs and Sarepta Therapeutics

0.29

Correlation Coefficient

Y MAbs  Sarepta Therapeutics

Modest diversification

The 3 months correlation between YMAB and Sarepta is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Y mAbs Therapeutics and Sarepta Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarepta Therapeutics and Y MAbs 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 Y mAbs Therapeutics are associated (or correlated) with Sarepta Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarepta Therapeutics has no effect on the direction of Y MAbs i.e., Y MAbs and Sarepta Therapeutics go up and down completely randomly.

Pair Corralation between Y MAbs and Sarepta Therapeutics

Given the investment horizon of 90 days Y mAbs Therapeutics is expected to generate 1.37 times more return on investment than Sarepta Therapeutics. However, Y MAbs is 1.37 times more volatile than Sarepta Therapeutics. It trades about 0.05 of its potential returns per unit of risk. Sarepta Therapeutics is currently generating about 0.02 per unit of risk. If you would invest  459.00  in Y mAbs Therapeutics on September 13, 2024 and sell it today you would earn a total of  542.00  from holding Y mAbs Therapeutics or generate 118.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Y mAbs Therapeutics  vs.  Sarepta Therapeutics

Y mAbs Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Y mAbs Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat 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.

Sarepta Therapeutics

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sarepta Therapeutics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Sarepta Therapeutics is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Y MAbs and Sarepta Therapeutics

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

The idea behind Y mAbs Therapeutics and Sarepta Therapeutics 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.