Correlation Between Aeterna Zentaris and Bio Path
Can any of the company-specific risk be diversified away by investing in both Aeterna Zentaris and Bio Path 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 Aeterna Zentaris and Bio Path into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeterna Zentaris and Bio Path Holdings, you can compare the effects of market volatilities on Aeterna Zentaris and Bio Path 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 Aeterna Zentaris with a short position of Bio Path. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeterna Zentaris and Bio Path.
Diversification Opportunities for Aeterna Zentaris and Bio Path
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aeterna and Bio is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Aeterna Zentaris and Bio Path Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Path Holdings and Aeterna Zentaris 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 Aeterna Zentaris are associated (or correlated) with Bio Path. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Path Holdings has no effect on the direction of Aeterna Zentaris i.e., Aeterna Zentaris and Bio Path go up and down completely randomly.
Pair Corralation between Aeterna Zentaris and Bio Path
Given the investment horizon of 90 days Aeterna Zentaris is expected to generate 0.5 times more return on investment than Bio Path. However, Aeterna Zentaris is 2.01 times less risky than Bio Path. It trades about -0.03 of its potential returns per unit of risk. Bio Path Holdings is currently generating about -0.05 per unit of risk. If you would invest 1,460 in Aeterna Zentaris on September 3, 2024 and sell it today you would lose (846.00) from holding Aeterna Zentaris or give up 57.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 84.24% |
| Values | Daily Returns |
Aeterna Zentaris vs. Bio Path Holdings
Performance |
| Timeline |
| Aeterna Zentaris |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bio Path Holdings |
Aeterna Zentaris and Bio Path Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeterna Zentaris and Bio Path
The main advantage of trading using opposite Aeterna Zentaris and Bio Path positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeterna Zentaris position performs unexpectedly, Bio Path 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 Bio Path will offset losses from the drop in Bio Path's long position.| Aeterna Zentaris vs. Pulmatrix | Aeterna Zentaris vs. Bio Path Holdings | Aeterna Zentaris vs. Moleculin Biotech | Aeterna Zentaris vs. Adial Pharmaceuticals |
| Bio Path vs. Capricor Therapeutics | Bio Path vs. NextCure | Bio Path vs. Pulmatrix | Bio Path vs. Crinetics Pharmaceuticals |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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