Correlation Between Cytokinetics and Kezar Life
Can any of the company-specific risk be diversified away by investing in both Cytokinetics and Kezar Life 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 Cytokinetics and Kezar Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cytokinetics and Kezar Life Sciences, you can compare the effects of market volatilities on Cytokinetics and Kezar Life 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 Cytokinetics with a short position of Kezar Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cytokinetics and Kezar Life.
Diversification Opportunities for Cytokinetics and Kezar Life
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cytokinetics and Kezar is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cytokinetics and Kezar Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kezar Life Sciences and Cytokinetics 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 Cytokinetics are associated (or correlated) with Kezar Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kezar Life Sciences has no effect on the direction of Cytokinetics i.e., Cytokinetics and Kezar Life go up and down completely randomly.
Pair Corralation between Cytokinetics and Kezar Life
Given the investment horizon of 90 days Cytokinetics is expected to generate 1.06 times more return on investment than Kezar Life. However, Cytokinetics is 1.06 times more volatile than Kezar Life Sciences. It trades about 0.06 of its potential returns per unit of risk. Kezar Life Sciences is currently generating about -0.02 per unit of risk. If you would invest 4,893 in Cytokinetics on November 2, 2024 and sell it today you would earn a total of 104.00 from holding Cytokinetics or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cytokinetics vs. Kezar Life Sciences
Performance |
| Timeline |
| Cytokinetics |
| Kezar Life Sciences |
Cytokinetics and Kezar Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cytokinetics and Kezar Life
The main advantage of trading using opposite Cytokinetics and Kezar Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cytokinetics position performs unexpectedly, Kezar Life 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 Kezar Life will offset losses from the drop in Kezar Life's long position.| Cytokinetics vs. Edgewise Therapeutics | Cytokinetics vs. Dyne Therapeutics | Cytokinetics vs. Stoke Therapeutics | Cytokinetics vs. Pliant Therapeutics |
| Kezar Life vs. Century Therapeutics | Kezar Life vs. Mineralys Therapeutics, Common | Kezar Life vs. Nkarta Inc | Kezar Life vs. Surrozen |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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