Correlation Between Awakn Life and Kane Biotech
Can any of the company-specific risk be diversified away by investing in both Awakn Life and Kane Biotech 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 Awakn Life and Kane Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Awakn Life Sciences and Kane Biotech, you can compare the effects of market volatilities on Awakn Life and Kane Biotech 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 Awakn Life with a short position of Kane Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Awakn Life and Kane Biotech.
Diversification Opportunities for Awakn Life and Kane Biotech
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Awakn and Kane is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Awakn Life Sciences and Kane Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kane Biotech and Awakn Life 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 Awakn Life Sciences are associated (or correlated) with Kane Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kane Biotech has no effect on the direction of Awakn Life i.e., Awakn Life and Kane Biotech go up and down completely randomly.
Pair Corralation between Awakn Life and Kane Biotech
Assuming the 90 days horizon Awakn Life Sciences is expected to under-perform the Kane Biotech. But the pink sheet apears to be less risky and, when comparing its historical volatility, Awakn Life Sciences is 1.02 times less risky than Kane Biotech. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Kane Biotech is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 7.67 in Kane Biotech on October 26, 2024 and sell it today you would earn a total of 0.33 from holding Kane Biotech or generate 4.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Awakn Life Sciences vs. Kane Biotech
Performance |
| Timeline |
| Awakn Life Sciences |
| Kane Biotech |
Awakn Life and Kane Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Awakn Life and Kane Biotech
The main advantage of trading using opposite Awakn Life and Kane Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Awakn Life position performs unexpectedly, Kane Biotech 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 Kane Biotech will offset losses from the drop in Kane Biotech's long position.| Awakn Life vs. Nova Mentis Life | Awakn Life vs. PsyBio Therapeutics Corp | Awakn Life vs. HAVN Life Sciences | Awakn Life vs. Cellectis SA |
| Kane Biotech vs. Pharming Group NV | Kane Biotech vs. Health Sciences Gr | Kane Biotech vs. MedMira | Kane Biotech vs. Oxford Cannabinoid Technologies |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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