Correlation Between Agios Pharm and Stoke Therapeutics
Can any of the company-specific risk be diversified away by investing in both Agios Pharm and Stoke 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 Agios Pharm and Stoke Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agios Pharm and Stoke Therapeutics, you can compare the effects of market volatilities on Agios Pharm and Stoke 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 Agios Pharm with a short position of Stoke Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agios Pharm and Stoke Therapeutics.
Diversification Opportunities for Agios Pharm and Stoke Therapeutics
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Agios and Stoke is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Agios Pharm and Stoke Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stoke Therapeutics and Agios Pharm 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 Agios Pharm are associated (or correlated) with Stoke Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stoke Therapeutics has no effect on the direction of Agios Pharm i.e., Agios Pharm and Stoke Therapeutics go up and down completely randomly.
Pair Corralation between Agios Pharm and Stoke Therapeutics
Given the investment horizon of 90 days Agios Pharm is expected to generate 1.3 times less return on investment than Stoke Therapeutics. But when comparing it to its historical volatility, Agios Pharm is 1.98 times less risky than Stoke Therapeutics. It trades about 0.06 of its potential returns per unit of risk. Stoke Therapeutics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Stoke Therapeutics on September 2, 2024 and sell it today you would earn a total of 400.00 from holding Stoke Therapeutics or generate 49.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agios Pharm vs. Stoke Therapeutics
Performance |
| Timeline |
| Agios Pharm |
| Stoke Therapeutics |
Agios Pharm and Stoke Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agios Pharm and Stoke Therapeutics
The main advantage of trading using opposite Agios Pharm and Stoke Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agios Pharm position performs unexpectedly, Stoke 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 Stoke Therapeutics will offset losses from the drop in Stoke Therapeutics' long position.| Agios Pharm vs. Mereo BioPharma Group | Agios Pharm vs. Blueprint Medicines Corp | Agios Pharm vs. Day One Biopharmaceuticals | Agios Pharm vs. Biomarin Pharmaceutical |
| Stoke Therapeutics vs. Tff Pharmaceuticals | Stoke Therapeutics vs. Eliem Therapeutics | Stoke Therapeutics vs. Inhibrx | Stoke Therapeutics vs. Enliven 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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