Correlation Between AN2 Therapeutics and Onconova Therapeutics
Can any of the company-specific risk be diversified away by investing in both AN2 Therapeutics and Onconova 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 AN2 Therapeutics and Onconova Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AN2 Therapeutics and Onconova Therapeutics, you can compare the effects of market volatilities on AN2 Therapeutics and Onconova 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 AN2 Therapeutics with a short position of Onconova Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of AN2 Therapeutics and Onconova Therapeutics.
Diversification Opportunities for AN2 Therapeutics and Onconova Therapeutics
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AN2 and Onconova is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding AN2 Therapeutics and Onconova Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onconova Therapeutics and AN2 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 AN2 Therapeutics are associated (or correlated) with Onconova Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onconova Therapeutics has no effect on the direction of AN2 Therapeutics i.e., AN2 Therapeutics and Onconova Therapeutics go up and down completely randomly.
Pair Corralation between AN2 Therapeutics and Onconova Therapeutics
Given the investment horizon of 90 days AN2 Therapeutics is expected to under-perform the Onconova Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, AN2 Therapeutics is 1.12 times less risky than Onconova Therapeutics. The stock trades about -0.01 of its potential returns per unit of risk. The Onconova Therapeutics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 75.00 in Onconova Therapeutics on August 30, 2024 and sell it today you would earn a total of 27.00 from holding Onconova Therapeutics or generate 36.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.31% |
| Values | Daily Returns |
AN2 Therapeutics vs. Onconova Therapeutics
Performance |
| Timeline |
| AN2 Therapeutics |
| Onconova Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AN2 Therapeutics and Onconova Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AN2 Therapeutics and Onconova Therapeutics
The main advantage of trading using opposite AN2 Therapeutics and Onconova Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AN2 Therapeutics position performs unexpectedly, Onconova 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 Onconova Therapeutics will offset losses from the drop in Onconova Therapeutics' long position.| AN2 Therapeutics vs. Bright Minds Biosciences | AN2 Therapeutics vs. HP Inc | AN2 Therapeutics vs. Intel | AN2 Therapeutics vs. Chevron Corp |
| Onconova Therapeutics vs. Jaguar Animal Health | Onconova Therapeutics vs. Ibio Inc | Onconova Therapeutics vs. GeoVax Labs | Onconova Therapeutics vs. Ocugen 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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