Correlation Between Affimed NV and Rani Therapeutics
Can any of the company-specific risk be diversified away by investing in both Affimed NV and Rani 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 Affimed NV and Rani Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affimed NV and Rani Therapeutics Holdings, you can compare the effects of market volatilities on Affimed NV and Rani 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 Affimed NV with a short position of Rani Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affimed NV and Rani Therapeutics.
Diversification Opportunities for Affimed NV and Rani Therapeutics
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Affimed and Rani is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Affimed NV and Rani Therapeutics Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rani Therapeutics and Affimed NV 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 Affimed NV are associated (or correlated) with Rani Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rani Therapeutics has no effect on the direction of Affimed NV i.e., Affimed NV and Rani Therapeutics go up and down completely randomly.
Pair Corralation between Affimed NV and Rani Therapeutics
Given the investment horizon of 90 days Affimed NV is expected to generate 1.48 times more return on investment than Rani Therapeutics. However, Affimed NV is 1.48 times more volatile than Rani Therapeutics Holdings. It trades about -0.1 of its potential returns per unit of risk. Rani Therapeutics Holdings is currently generating about -0.17 per unit of risk. If you would invest 335.00 in Affimed NV on August 30, 2024 and sell it today you would lose (51.00) from holding Affimed NV or give up 15.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affimed NV vs. Rani Therapeutics Holdings
Performance |
| Timeline |
| Affimed NV |
| Rani Therapeutics |
Affimed NV and Rani Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affimed NV and Rani Therapeutics
The main advantage of trading using opposite Affimed NV and Rani Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affimed NV position performs unexpectedly, Rani 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 Rani Therapeutics will offset losses from the drop in Rani Therapeutics' long position.| Affimed NV vs. Ikena Oncology | Affimed NV vs. Eliem Therapeutics | Affimed NV vs. HCW Biologics | Affimed NV vs. Tempest Therapeutics |
| Rani Therapeutics vs. Ikena Oncology | Rani Therapeutics vs. Eliem Therapeutics | Rani Therapeutics vs. HCW Biologics | Rani Therapeutics vs. Tempest Therapeutics |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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