Correlation Between Cyclacel Pharmaceuticals and Akari Therapeutics
Can any of the company-specific risk be diversified away by investing in both Cyclacel Pharmaceuticals and Akari 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 Cyclacel Pharmaceuticals and Akari Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cyclacel Pharmaceuticals and Akari Therapeutics PLC, you can compare the effects of market volatilities on Cyclacel Pharmaceuticals and Akari 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 Cyclacel Pharmaceuticals with a short position of Akari Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cyclacel Pharmaceuticals and Akari Therapeutics.
Diversification Opportunities for Cyclacel Pharmaceuticals and Akari Therapeutics
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cyclacel and Akari is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Cyclacel Pharmaceuticals and Akari Therapeutics PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akari Therapeutics PLC and Cyclacel Pharmaceuticals 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 Cyclacel Pharmaceuticals are associated (or correlated) with Akari Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akari Therapeutics PLC has no effect on the direction of Cyclacel Pharmaceuticals i.e., Cyclacel Pharmaceuticals and Akari Therapeutics go up and down completely randomly.
Pair Corralation between Cyclacel Pharmaceuticals and Akari Therapeutics
Given the investment horizon of 90 days Cyclacel Pharmaceuticals is expected to under-perform the Akari Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Cyclacel Pharmaceuticals is 1.18 times less risky than Akari Therapeutics. The stock trades about -0.16 of its potential returns per unit of risk. The Akari Therapeutics PLC is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 169.00 in Akari Therapeutics PLC on September 1, 2024 and sell it today you would lose (48.00) from holding Akari Therapeutics PLC or give up 28.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cyclacel Pharmaceuticals vs. Akari Therapeutics PLC
Performance |
| Timeline |
| Cyclacel Pharmaceuticals |
| Akari Therapeutics PLC |
Cyclacel Pharmaceuticals and Akari Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cyclacel Pharmaceuticals and Akari Therapeutics
The main advantage of trading using opposite Cyclacel Pharmaceuticals and Akari Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cyclacel Pharmaceuticals position performs unexpectedly, Akari 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 Akari Therapeutics will offset losses from the drop in Akari Therapeutics' long position.| Cyclacel Pharmaceuticals vs. Eliem Therapeutics | Cyclacel Pharmaceuticals vs. Ikena Oncology | Cyclacel Pharmaceuticals vs. Ovid Therapeutics | Cyclacel Pharmaceuticals vs. Connect Biopharma Holdings |
| Akari Therapeutics vs. Armata Pharmaceuticals | Akari Therapeutics vs. Anebulo Pharmaceuticals | Akari Therapeutics vs. Processa Pharmaceuticals | Akari Therapeutics vs. Salarius Pharmaceuticals |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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