Correlation Between Avenue Therapeutics and CytomX Therapeutics
Can any of the company-specific risk be diversified away by investing in both Avenue Therapeutics and CytomX 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 Avenue Therapeutics and CytomX Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avenue Therapeutics and CytomX Therapeutics, you can compare the effects of market volatilities on Avenue Therapeutics and CytomX 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 Avenue Therapeutics with a short position of CytomX Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avenue Therapeutics and CytomX Therapeutics.
Diversification Opportunities for Avenue Therapeutics and CytomX Therapeutics
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Avenue and CytomX is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Avenue Therapeutics and CytomX Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CytomX Therapeutics and Avenue 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 Avenue Therapeutics are associated (or correlated) with CytomX Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CytomX Therapeutics has no effect on the direction of Avenue Therapeutics i.e., Avenue Therapeutics and CytomX Therapeutics go up and down completely randomly.
Pair Corralation between Avenue Therapeutics and CytomX Therapeutics
Given the investment horizon of 90 days Avenue Therapeutics is expected to under-perform the CytomX Therapeutics. In addition to that, Avenue Therapeutics is 1.33 times more volatile than CytomX Therapeutics. It trades about -0.24 of its total potential returns per unit of risk. CytomX Therapeutics is currently generating about -0.21 per unit of volatility. If you would invest 106.00 in CytomX Therapeutics on November 3, 2024 and sell it today you would lose (21.00) from holding CytomX Therapeutics or give up 19.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avenue Therapeutics vs. CytomX Therapeutics
Performance |
| Timeline |
| Avenue Therapeutics |
| CytomX Therapeutics |
Avenue Therapeutics and CytomX Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avenue Therapeutics and CytomX Therapeutics
The main advantage of trading using opposite Avenue Therapeutics and CytomX Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avenue Therapeutics position performs unexpectedly, CytomX 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 CytomX Therapeutics will offset losses from the drop in CytomX Therapeutics' long position.| Avenue Therapeutics vs. Hoth Therapeutics | Avenue Therapeutics vs. Revelation Biosciences | Avenue Therapeutics vs. Virax Biolabs Group | Avenue Therapeutics vs. Palisade Bio |
| CytomX Therapeutics vs. Spero Therapeutics | CytomX Therapeutics vs. Instil Bio | CytomX Therapeutics vs. NextCure | CytomX Therapeutics vs. Assembly Biosciences |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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