Correlation Between ADC Therapeutics and Agenus
Can any of the company-specific risk be diversified away by investing in both ADC Therapeutics and Agenus 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 ADC Therapeutics and Agenus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADC Therapeutics SA and Agenus Inc, you can compare the effects of market volatilities on ADC Therapeutics and Agenus 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 ADC Therapeutics with a short position of Agenus. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADC Therapeutics and Agenus.
Diversification Opportunities for ADC Therapeutics and Agenus
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ADC and Agenus is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding ADC Therapeutics SA and Agenus Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agenus Inc and ADC 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 ADC Therapeutics SA are associated (or correlated) with Agenus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agenus Inc has no effect on the direction of ADC Therapeutics i.e., ADC Therapeutics and Agenus go up and down completely randomly.
Pair Corralation between ADC Therapeutics and Agenus
Given the investment horizon of 90 days ADC Therapeutics SA is expected to under-perform the Agenus. But the stock apears to be less risky and, when comparing its historical volatility, ADC Therapeutics SA is 1.63 times less risky than Agenus. The stock trades about -0.41 of its potential returns per unit of risk. The Agenus Inc is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 441.00 in Agenus Inc on August 28, 2024 and sell it today you would lose (86.00) from holding Agenus Inc or give up 19.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
ADC Therapeutics SA vs. Agenus Inc
Performance |
| Timeline |
| ADC Therapeutics |
| Agenus Inc |
ADC Therapeutics and Agenus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADC Therapeutics and Agenus
The main advantage of trading using opposite ADC Therapeutics and Agenus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADC Therapeutics position performs unexpectedly, Agenus 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 Agenus will offset losses from the drop in Agenus' long position.| ADC Therapeutics vs. Passage Bio | ADC Therapeutics vs. Black Diamond Therapeutics | ADC Therapeutics vs. Alector | ADC Therapeutics vs. Century Therapeutics |
| Agenus vs. Marker Therapeutics | Agenus vs. Edgewise Therapeutics | Agenus vs. Adaptimmune Therapeutics Plc | Agenus vs. Mereo BioPharma Group |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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