Correlation Between BioXcel Therapeutics and Intercept Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both BioXcel Therapeutics and Intercept Pharmaceuticals 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 BioXcel Therapeutics and Intercept Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioXcel Therapeutics and Intercept Pharmaceuticals, you can compare the effects of market volatilities on BioXcel Therapeutics and Intercept Pharmaceuticals 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 BioXcel Therapeutics with a short position of Intercept Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioXcel Therapeutics and Intercept Pharmaceuticals.
Diversification Opportunities for BioXcel Therapeutics and Intercept Pharmaceuticals
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BioXcel and Intercept is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding BioXcel Therapeutics and Intercept Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intercept Pharmaceuticals and BioXcel 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 BioXcel Therapeutics are associated (or correlated) with Intercept Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intercept Pharmaceuticals has no effect on the direction of BioXcel Therapeutics i.e., BioXcel Therapeutics and Intercept Pharmaceuticals go up and down completely randomly.
Pair Corralation between BioXcel Therapeutics and Intercept Pharmaceuticals
If you would invest 32.00 in BioXcel Therapeutics on October 20, 2024 and sell it today you would earn a total of 2.00 from holding BioXcel Therapeutics or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.0% |
| Values | Daily Returns |
BioXcel Therapeutics vs. Intercept Pharmaceuticals
Performance |
| Timeline |
| BioXcel Therapeutics |
| Intercept Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BioXcel Therapeutics and Intercept Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioXcel Therapeutics and Intercept Pharmaceuticals
The main advantage of trading using opposite BioXcel Therapeutics and Intercept Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioXcel Therapeutics position performs unexpectedly, Intercept Pharmaceuticals 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 Intercept Pharmaceuticals will offset losses from the drop in Intercept Pharmaceuticals' long position.| BioXcel Therapeutics vs. Terns Pharmaceuticals | BioXcel Therapeutics vs. Amylyx Pharmaceuticals | BioXcel Therapeutics vs. Acumen Pharmaceuticals | BioXcel Therapeutics vs. Inozyme Pharma |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |