Correlation Between Bolt Biotherapeutics and Kezar Life
Can any of the company-specific risk be diversified away by investing in both Bolt Biotherapeutics and Kezar Life 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 Bolt Biotherapeutics and Kezar Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bolt Biotherapeutics and Kezar Life Sciences, you can compare the effects of market volatilities on Bolt Biotherapeutics and Kezar Life 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 Bolt Biotherapeutics with a short position of Kezar Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bolt Biotherapeutics and Kezar Life.
Diversification Opportunities for Bolt Biotherapeutics and Kezar Life
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bolt and Kezar is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Bolt Biotherapeutics and Kezar Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kezar Life Sciences and Bolt 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 Bolt Biotherapeutics are associated (or correlated) with Kezar Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kezar Life Sciences has no effect on the direction of Bolt Biotherapeutics i.e., Bolt Biotherapeutics and Kezar Life go up and down completely randomly.
Pair Corralation between Bolt Biotherapeutics and Kezar Life
Given the investment horizon of 90 days Bolt Biotherapeutics is expected to generate 2.02 times more return on investment than Kezar Life. However, Bolt Biotherapeutics is 2.02 times more volatile than Kezar Life Sciences. It trades about 0.04 of its potential returns per unit of risk. Kezar Life Sciences is currently generating about 0.02 per unit of risk. If you would invest 63.00 in Bolt Biotherapeutics on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Bolt Biotherapeutics or generate 1.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bolt Biotherapeutics vs. Kezar Life Sciences
Performance |
| Timeline |
| Bolt Biotherapeutics |
| Kezar Life Sciences |
Bolt Biotherapeutics and Kezar Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bolt Biotherapeutics and Kezar Life
The main advantage of trading using opposite Bolt Biotherapeutics and Kezar Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bolt Biotherapeutics position performs unexpectedly, Kezar Life 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 Kezar Life will offset losses from the drop in Kezar Life's long position.| Bolt Biotherapeutics vs. Assembly Biosciences | Bolt Biotherapeutics vs. Instil Bio | Bolt Biotherapeutics vs. CytomX Therapeutics | Bolt Biotherapeutics vs. Achilles Therapeutics PLC |
| Kezar Life vs. Century Therapeutics | Kezar Life vs. Mineralys Therapeutics, Common | Kezar Life vs. Nkarta Inc | Kezar Life vs. Surrozen |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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