Correlation Between Akari Therapeutics and Eli Lilly
Can any of the company-specific risk be diversified away by investing in both Akari Therapeutics and Eli Lilly 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 Akari Therapeutics and Eli Lilly into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akari Therapeutics PLC and Eli Lilly and, you can compare the effects of market volatilities on Akari Therapeutics and Eli Lilly 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 Akari Therapeutics with a short position of Eli Lilly. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akari Therapeutics and Eli Lilly.
Diversification Opportunities for Akari Therapeutics and Eli Lilly
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Akari and Eli is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Akari Therapeutics PLC and Eli Lilly and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eli Lilly and Akari 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 Akari Therapeutics PLC are associated (or correlated) with Eli Lilly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eli Lilly has no effect on the direction of Akari Therapeutics i.e., Akari Therapeutics and Eli Lilly go up and down completely randomly.
Pair Corralation between Akari Therapeutics and Eli Lilly
Given the investment horizon of 90 days Akari Therapeutics PLC is expected to under-perform the Eli Lilly. In addition to that, Akari Therapeutics is 2.97 times more volatile than Eli Lilly and. It trades about -0.1 of its total potential returns per unit of risk. Eli Lilly and is currently generating about 0.21 per unit of volatility. If you would invest 76,510 in Eli Lilly and on November 7, 2024 and sell it today you would earn a total of 7,708 from holding Eli Lilly and or generate 10.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akari Therapeutics PLC vs. Eli Lilly and
Performance |
| Timeline |
| Akari Therapeutics PLC |
| Eli Lilly |
Akari Therapeutics and Eli Lilly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akari Therapeutics and Eli Lilly
The main advantage of trading using opposite Akari Therapeutics and Eli Lilly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akari Therapeutics position performs unexpectedly, Eli Lilly 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 Eli Lilly will offset losses from the drop in Eli Lilly's long position.| Akari Therapeutics vs. Armata Pharmaceuticals | Akari Therapeutics vs. Anebulo Pharmaceuticals | Akari Therapeutics vs. Processa Pharmaceuticals | Akari Therapeutics vs. Salarius Pharmaceuticals |
| Eli Lilly vs. Johnson Johnson | Eli Lilly vs. Bristol Myers Squibb | Eli Lilly vs. AbbVie Inc | Eli Lilly vs. Pfizer Inc |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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