Correlation Between AnaptysBio and Adagene
Can any of the company-specific risk be diversified away by investing in both AnaptysBio and Adagene 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 AnaptysBio and Adagene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AnaptysBio and Adagene, you can compare the effects of market volatilities on AnaptysBio and Adagene 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 AnaptysBio with a short position of Adagene. Check out your portfolio center. Please also check ongoing floating volatility patterns of AnaptysBio and Adagene.
Diversification Opportunities for AnaptysBio and Adagene
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between AnaptysBio and Adagene is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding AnaptysBio and Adagene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adagene and AnaptysBio 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 AnaptysBio are associated (or correlated) with Adagene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adagene has no effect on the direction of AnaptysBio i.e., AnaptysBio and Adagene go up and down completely randomly.
Pair Corralation between AnaptysBio and Adagene
Given the investment horizon of 90 days AnaptysBio is expected to under-perform the Adagene. In addition to that, AnaptysBio is 1.41 times more volatile than Adagene. It trades about -0.18 of its total potential returns per unit of risk. Adagene is currently generating about -0.21 per unit of volatility. If you would invest 290.00 in Adagene on August 25, 2024 and sell it today you would lose (71.00) from holding Adagene or give up 24.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AnaptysBio vs. Adagene
Performance |
| Timeline |
| AnaptysBio |
| Adagene |
AnaptysBio and Adagene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AnaptysBio and Adagene
The main advantage of trading using opposite AnaptysBio and Adagene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AnaptysBio position performs unexpectedly, Adagene 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 Adagene will offset losses from the drop in Adagene's long position.| AnaptysBio vs. Crinetics Pharmaceuticals | AnaptysBio vs. Rhythm Pharmaceuticals | AnaptysBio vs. Kura Oncology | AnaptysBio vs. CytomX Therapeutics |
| Adagene vs. Aerovate Therapeutics | Adagene vs. Acrivon Therapeutics, Common | Adagene vs. Rezolute | Adagene vs. AN2 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 Positions Ratings module to 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.
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