Correlation Between AptaBio Therapeutics and Bridge Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Bridge Biotherapeutics 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 AptaBio Therapeutics and Bridge Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Bridge Biotherapeutics, you can compare the effects of market volatilities on AptaBio Therapeutics and Bridge Biotherapeutics 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 AptaBio Therapeutics with a short position of Bridge Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Bridge Biotherapeutics.
Diversification Opportunities for AptaBio Therapeutics and Bridge Biotherapeutics
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AptaBio and Bridge is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Bridge Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridge Biotherapeutics and AptaBio 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 AptaBio Therapeutics are associated (or correlated) with Bridge Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridge Biotherapeutics has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Bridge Biotherapeutics go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Bridge Biotherapeutics
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 8.23 times less return on investment than Bridge Biotherapeutics. But when comparing it to its historical volatility, AptaBio Therapeutics is 1.3 times less risky than Bridge Biotherapeutics. It trades about 0.01 of its potential returns per unit of risk. Bridge Biotherapeutics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 205,565 in Bridge Biotherapeutics on September 4, 2024 and sell it today you would earn a total of 139,935 from holding Bridge Biotherapeutics or generate 68.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. Bridge Biotherapeutics
Performance |
| Timeline |
| AptaBio Therapeutics |
| Bridge Biotherapeutics |
AptaBio Therapeutics and Bridge Biotherapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and Bridge Biotherapeutics
The main advantage of trading using opposite AptaBio Therapeutics and Bridge Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Bridge Biotherapeutics 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 Bridge Biotherapeutics will offset losses from the drop in Bridge Biotherapeutics' long position.| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
| Bridge Biotherapeutics vs. AptaBio Therapeutics | Bridge Biotherapeutics vs. Cytogen | Bridge Biotherapeutics vs. Genolution |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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