Correlation Between Clal Biotechnology and Enlivex Therapeutics
Can any of the company-specific risk be diversified away by investing in both Clal Biotechnology and Enlivex 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 Clal Biotechnology and Enlivex Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clal Biotechnology Industries and Enlivex Therapeutics, you can compare the effects of market volatilities on Clal Biotechnology and Enlivex 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 Clal Biotechnology with a short position of Enlivex Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clal Biotechnology and Enlivex Therapeutics.
Diversification Opportunities for Clal Biotechnology and Enlivex Therapeutics
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Clal and Enlivex is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Clal Biotechnology Industries and Enlivex Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enlivex Therapeutics and Clal Biotechnology 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 Clal Biotechnology Industries are associated (or correlated) with Enlivex Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enlivex Therapeutics has no effect on the direction of Clal Biotechnology i.e., Clal Biotechnology and Enlivex Therapeutics go up and down completely randomly.
Pair Corralation between Clal Biotechnology and Enlivex Therapeutics
Assuming the 90 days trading horizon Clal Biotechnology Industries is expected to generate 0.62 times more return on investment than Enlivex Therapeutics. However, Clal Biotechnology Industries is 1.6 times less risky than Enlivex Therapeutics. It trades about -0.04 of its potential returns per unit of risk. Enlivex Therapeutics is currently generating about -0.03 per unit of risk. If you would invest 3,980 in Clal Biotechnology Industries on September 3, 2024 and sell it today you would lose (300.00) from holding Clal Biotechnology Industries or give up 7.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clal Biotechnology Industries vs. Enlivex Therapeutics
Performance |
| Timeline |
| Clal Biotechnology |
| Enlivex Therapeutics |
Clal Biotechnology and Enlivex Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clal Biotechnology and Enlivex Therapeutics
The main advantage of trading using opposite Clal Biotechnology and Enlivex Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clal Biotechnology position performs unexpectedly, Enlivex 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 Enlivex Therapeutics will offset losses from the drop in Enlivex Therapeutics' long position.| Clal Biotechnology vs. Kamada | Clal Biotechnology vs. BioLine RX | Clal Biotechnology vs. Evogene | Clal Biotechnology vs. Bezeq Israeli Telecommunication |
| Enlivex Therapeutics vs. Purple Biotech | Enlivex Therapeutics vs. BioLine RX | Enlivex Therapeutics vs. Clal Biotechnology Industries | Enlivex Therapeutics vs. Evogene |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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