Correlation Between Arcutis Biotherapeutics and Protagonist Therapeutics
Can any of the company-specific risk be diversified away by investing in both Arcutis Biotherapeutics and Protagonist 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 Arcutis Biotherapeutics and Protagonist Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arcutis Biotherapeutics and Protagonist Therapeutics, you can compare the effects of market volatilities on Arcutis Biotherapeutics and Protagonist 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 Arcutis Biotherapeutics with a short position of Protagonist Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arcutis Biotherapeutics and Protagonist Therapeutics.
Diversification Opportunities for Arcutis Biotherapeutics and Protagonist Therapeutics
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arcutis and Protagonist is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Arcutis Biotherapeutics and Protagonist Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protagonist Therapeutics and Arcutis Biotherapeutics 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 Arcutis Biotherapeutics are associated (or correlated) with Protagonist Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protagonist Therapeutics has no effect on the direction of Arcutis Biotherapeutics i.e., Arcutis Biotherapeutics and Protagonist Therapeutics go up and down completely randomly.
Pair Corralation between Arcutis Biotherapeutics and Protagonist Therapeutics
Given the investment horizon of 90 days Arcutis Biotherapeutics is expected to generate 3.94 times less return on investment than Protagonist Therapeutics. In addition to that, Arcutis Biotherapeutics is 1.28 times more volatile than Protagonist Therapeutics. It trades about 0.02 of its total potential returns per unit of risk. Protagonist Therapeutics is currently generating about 0.09 per unit of volatility. If you would invest 1,134 in Protagonist Therapeutics on August 31, 2024 and sell it today you would earn a total of 3,361 from holding Protagonist Therapeutics or generate 296.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arcutis Biotherapeutics vs. Protagonist Therapeutics
Performance |
| Timeline |
| Arcutis Biotherapeutics |
| Protagonist Therapeutics |
Arcutis Biotherapeutics and Protagonist Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arcutis Biotherapeutics and Protagonist Therapeutics
The main advantage of trading using opposite Arcutis Biotherapeutics and Protagonist Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arcutis Biotherapeutics position performs unexpectedly, Protagonist 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 Protagonist Therapeutics will offset losses from the drop in Protagonist Therapeutics' long position.| Arcutis Biotherapeutics vs. Terns Pharmaceuticals | Arcutis Biotherapeutics vs. Amylyx Pharmaceuticals | Arcutis Biotherapeutics vs. Acumen Pharmaceuticals | Arcutis Biotherapeutics vs. Inozyme Pharma |
| Protagonist Therapeutics vs. Revolution Medicines | Protagonist Therapeutics vs. Akero Therapeutics | Protagonist Therapeutics vs. Avidity Biosciences | Protagonist Therapeutics vs. Stoke 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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