Correlation Between Cabaletta Bio and Ikena Oncology
Can any of the company-specific risk be diversified away by investing in both Cabaletta Bio and Ikena Oncology 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 Cabaletta Bio and Ikena Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabaletta Bio and Ikena Oncology, you can compare the effects of market volatilities on Cabaletta Bio and Ikena Oncology 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 Cabaletta Bio with a short position of Ikena Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabaletta Bio and Ikena Oncology.
Diversification Opportunities for Cabaletta Bio and Ikena Oncology
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cabaletta and Ikena is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Cabaletta Bio and Ikena Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ikena Oncology and Cabaletta Bio 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 Cabaletta Bio are associated (or correlated) with Ikena Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ikena Oncology has no effect on the direction of Cabaletta Bio i.e., Cabaletta Bio and Ikena Oncology go up and down completely randomly.
Pair Corralation between Cabaletta Bio and Ikena Oncology
Given the investment horizon of 90 days Cabaletta Bio is expected to under-perform the Ikena Oncology. In addition to that, Cabaletta Bio is 1.05 times more volatile than Ikena Oncology. It trades about -0.04 of its total potential returns per unit of risk. Ikena Oncology is currently generating about -0.03 per unit of volatility. If you would invest 700.00 in Ikena Oncology on August 29, 2024 and sell it today you would lose (529.00) from holding Ikena Oncology or give up 75.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cabaletta Bio vs. Ikena Oncology
Performance |
| Timeline |
| Cabaletta Bio |
| Ikena Oncology |
Cabaletta Bio and Ikena Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabaletta Bio and Ikena Oncology
The main advantage of trading using opposite Cabaletta Bio and Ikena Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabaletta Bio position performs unexpectedly, Ikena Oncology 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 Ikena Oncology will offset losses from the drop in Ikena Oncology's long position.| Cabaletta Bio vs. Revolution Medicines | Cabaletta Bio vs. Black Diamond Therapeutics | Cabaletta Bio vs. Passage Bio | Cabaletta Bio vs. 89bio Inc |
| Ikena Oncology vs. Eliem Therapeutics | Ikena Oncology vs. Scpharmaceuticals | Ikena Oncology vs. Milestone Pharmaceuticals | Ikena Oncology vs. Seres 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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