Correlation Between Acumen Pharmaceuticals and Nuvation Bio
Can any of the company-specific risk be diversified away by investing in both Acumen Pharmaceuticals and Nuvation Bio 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 Acumen Pharmaceuticals and Nuvation Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acumen Pharmaceuticals and Nuvation Bio, you can compare the effects of market volatilities on Acumen Pharmaceuticals and Nuvation Bio 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 Acumen Pharmaceuticals with a short position of Nuvation Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acumen Pharmaceuticals and Nuvation Bio.
Diversification Opportunities for Acumen Pharmaceuticals and Nuvation Bio
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Acumen and Nuvation is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Acumen Pharmaceuticals and Nuvation Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuvation Bio and Acumen Pharmaceuticals 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 Acumen Pharmaceuticals are associated (or correlated) with Nuvation Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuvation Bio has no effect on the direction of Acumen Pharmaceuticals i.e., Acumen Pharmaceuticals and Nuvation Bio go up and down completely randomly.
Pair Corralation between Acumen Pharmaceuticals and Nuvation Bio
Given the investment horizon of 90 days Acumen Pharmaceuticals is expected to under-perform the Nuvation Bio. In addition to that, Acumen Pharmaceuticals is 1.23 times more volatile than Nuvation Bio. It trades about -0.09 of its total potential returns per unit of risk. Nuvation Bio is currently generating about 0.17 per unit of volatility. If you would invest 233.00 in Nuvation Bio on August 24, 2024 and sell it today you would earn a total of 37.00 from holding Nuvation Bio or generate 15.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acumen Pharmaceuticals vs. Nuvation Bio
Performance |
| Timeline |
| Acumen Pharmaceuticals |
| Nuvation Bio |
Acumen Pharmaceuticals and Nuvation Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acumen Pharmaceuticals and Nuvation Bio
The main advantage of trading using opposite Acumen Pharmaceuticals and Nuvation Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acumen Pharmaceuticals position performs unexpectedly, Nuvation Bio 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 Nuvation Bio will offset losses from the drop in Nuvation Bio's long position.| Acumen Pharmaceuticals vs. Terns Pharmaceuticals | Acumen Pharmaceuticals vs. X4 Pharmaceuticals | Acumen Pharmaceuticals vs. Day One Biopharmaceuticals | Acumen Pharmaceuticals vs. Hookipa Pharma |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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