Correlation Between Catalyst Biosciences and Avenue Therapeutics
Can any of the company-specific risk be diversified away by investing in both Catalyst Biosciences and Avenue 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 Catalyst Biosciences and Avenue Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catalyst Biosciences and Avenue Therapeutics, you can compare the effects of market volatilities on Catalyst Biosciences and Avenue 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 Catalyst Biosciences with a short position of Avenue Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catalyst Biosciences and Avenue Therapeutics.
Diversification Opportunities for Catalyst Biosciences and Avenue Therapeutics
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Catalyst and Avenue is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Catalyst Biosciences and Avenue Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avenue Therapeutics and Catalyst Biosciences 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 Catalyst Biosciences are associated (or correlated) with Avenue Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avenue Therapeutics has no effect on the direction of Catalyst Biosciences i.e., Catalyst Biosciences and Avenue Therapeutics go up and down completely randomly.
Pair Corralation between Catalyst Biosciences and Avenue Therapeutics
If you would invest 41.00 in Catalyst Biosciences on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Catalyst Biosciences or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Catalyst Biosciences vs. Avenue Therapeutics
Performance |
| Timeline |
| Catalyst Biosciences |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Avenue Therapeutics |
Catalyst Biosciences and Avenue Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catalyst Biosciences and Avenue Therapeutics
The main advantage of trading using opposite Catalyst Biosciences and Avenue Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catalyst Biosciences position performs unexpectedly, Avenue 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 Avenue Therapeutics will offset losses from the drop in Avenue Therapeutics' long position.| Catalyst Biosciences vs. Akari Therapeutics PLC | Catalyst Biosciences vs. Benitec Biopharma Ltd | Catalyst Biosciences vs. Pulmatrix |
| Avenue Therapeutics vs. Hoth Therapeutics | Avenue Therapeutics vs. Revelation Biosciences | Avenue Therapeutics vs. Virax Biolabs Group | Avenue Therapeutics vs. Palisade Bio |
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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