Correlation Between Codexis and Alvotech
Can any of the company-specific risk be diversified away by investing in both Codexis and Alvotech 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 Codexis and Alvotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Codexis and Alvotech, you can compare the effects of market volatilities on Codexis and Alvotech 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 Codexis with a short position of Alvotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Codexis and Alvotech.
Diversification Opportunities for Codexis and Alvotech
Very poor diversification
The 3 months correlation between Codexis and Alvotech is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Codexis and Alvotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech and Codexis 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 Codexis are associated (or correlated) with Alvotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech has no effect on the direction of Codexis i.e., Codexis and Alvotech go up and down completely randomly.
Pair Corralation between Codexis and Alvotech
Given the investment horizon of 90 days Codexis is expected to generate 1.6 times more return on investment than Alvotech. However, Codexis is 1.6 times more volatile than Alvotech. It trades about -0.11 of its potential returns per unit of risk. Alvotech is currently generating about -0.24 per unit of risk. If you would invest 292.00 in Codexis on January 14, 2025 and sell it today you would lose (57.00) from holding Codexis or give up 19.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Codexis vs. Alvotech
Performance |
| Timeline |
| Codexis |
| Alvotech |
Codexis and Alvotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Codexis and Alvotech
The main advantage of trading using opposite Codexis and Alvotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Codexis position performs unexpectedly, Alvotech 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 Alvotech will offset losses from the drop in Alvotech's long position.| Codexis vs. Nuvation Bio | Codexis vs. Lyell Immunopharma | Codexis vs. Century Therapeutics | Codexis vs. Generation Bio Co |
| Alvotech vs. Amphastar P | Alvotech vs. Assertio Therapeutics | Alvotech vs. ANI Pharmaceuticals | Alvotech vs. Alkermes Plc |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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