Correlation Between Aeglea Bio and Summit Therapeutics
Can any of the company-specific risk be diversified away by investing in both Aeglea Bio and Summit 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 Aeglea Bio and Summit Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeglea Bio Therapeutics and Summit Therapeutics PLC, you can compare the effects of market volatilities on Aeglea Bio and Summit 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 Aeglea Bio with a short position of Summit Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeglea Bio and Summit Therapeutics.
Diversification Opportunities for Aeglea Bio and Summit Therapeutics
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aeglea and Summit is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Aeglea Bio Therapeutics and Summit Therapeutics PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Therapeutics PLC and Aeglea Bio 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 Aeglea Bio Therapeutics are associated (or correlated) with Summit Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Therapeutics PLC has no effect on the direction of Aeglea Bio i.e., Aeglea Bio and Summit Therapeutics go up and down completely randomly.
Pair Corralation between Aeglea Bio and Summit Therapeutics
If you would invest 59.00 in Aeglea Bio Therapeutics on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Aeglea Bio Therapeutics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Aeglea Bio Therapeutics vs. Summit Therapeutics PLC
Performance |
| Timeline |
| Aeglea Bio Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Summit Therapeutics PLC |
Aeglea Bio and Summit Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeglea Bio and Summit Therapeutics
The main advantage of trading using opposite Aeglea Bio and Summit Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeglea Bio position performs unexpectedly, Summit 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 Summit Therapeutics will offset losses from the drop in Summit Therapeutics' long position.| Aeglea Bio vs. Edgewise Therapeutics | Aeglea Bio vs. Ikena Oncology | Aeglea Bio vs. Design Therapeutics | Aeglea Bio vs. Xilio Development |
| Summit Therapeutics vs. Nkarta Inc | Summit Therapeutics vs. Cullinan Oncology LLC | Summit Therapeutics vs. Kezar Life Sciences | Summit Therapeutics vs. Kronos Bio |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |