Correlation Between Anika Therapeutics and Si Bone
Can any of the company-specific risk be diversified away by investing in both Anika Therapeutics and Si Bone 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 Anika Therapeutics and Si Bone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anika Therapeutics and Si Bone, you can compare the effects of market volatilities on Anika Therapeutics and Si Bone 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 Anika Therapeutics with a short position of Si Bone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anika Therapeutics and Si Bone.
Diversification Opportunities for Anika Therapeutics and Si Bone
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Anika and SIBN is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Anika Therapeutics and Si Bone in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Si Bone and Anika 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 Anika Therapeutics are associated (or correlated) with Si Bone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Si Bone has no effect on the direction of Anika Therapeutics i.e., Anika Therapeutics and Si Bone go up and down completely randomly.
Pair Corralation between Anika Therapeutics and Si Bone
Given the investment horizon of 90 days Anika Therapeutics is expected to under-perform the Si Bone. In addition to that, Anika Therapeutics is 1.31 times more volatile than Si Bone. It trades about -0.2 of its total potential returns per unit of risk. Si Bone is currently generating about 0.05 per unit of volatility. If you would invest 1,227 in Si Bone on August 28, 2024 and sell it today you would earn a total of 38.00 from holding Si Bone or generate 3.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anika Therapeutics vs. Si Bone
Performance |
| Timeline |
| Anika Therapeutics |
| Si Bone |
Anika Therapeutics and Si Bone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anika Therapeutics and Si Bone
The main advantage of trading using opposite Anika Therapeutics and Si Bone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anika Therapeutics position performs unexpectedly, Si Bone 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 Si Bone will offset losses from the drop in Si Bone's long position.| Anika Therapeutics vs. Eliem Therapeutics | Anika Therapeutics vs. HCW Biologics | Anika Therapeutics vs. Scpharmaceuticals | Anika Therapeutics vs. Milestone Pharmaceuticals |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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