Correlation Between DiaMedica Therapeutics and Gyre Therapeutics
Can any of the company-specific risk be diversified away by investing in both DiaMedica Therapeutics and Gyre 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 DiaMedica Therapeutics and Gyre Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DiaMedica Therapeutics and Gyre Therapeutics, you can compare the effects of market volatilities on DiaMedica Therapeutics and Gyre 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 DiaMedica Therapeutics with a short position of Gyre Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of DiaMedica Therapeutics and Gyre Therapeutics.
Diversification Opportunities for DiaMedica Therapeutics and Gyre Therapeutics
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between DiaMedica and Gyre is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding DiaMedica Therapeutics and Gyre Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gyre Therapeutics and DiaMedica Therapeutics 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 DiaMedica Therapeutics are associated (or correlated) with Gyre Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gyre Therapeutics has no effect on the direction of DiaMedica Therapeutics i.e., DiaMedica Therapeutics and Gyre Therapeutics go up and down completely randomly.
Pair Corralation between DiaMedica Therapeutics and Gyre Therapeutics
Given the investment horizon of 90 days DiaMedica Therapeutics is expected to generate 1.29 times less return on investment than Gyre Therapeutics. But when comparing it to its historical volatility, DiaMedica Therapeutics is 1.65 times less risky than Gyre Therapeutics. It trades about 0.08 of its potential returns per unit of risk. Gyre Therapeutics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 464.00 in Gyre Therapeutics on September 3, 2024 and sell it today you would earn a total of 787.00 from holding Gyre Therapeutics or generate 169.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DiaMedica Therapeutics vs. Gyre Therapeutics
Performance |
| Timeline |
| DiaMedica Therapeutics |
| Gyre Therapeutics |
DiaMedica Therapeutics and Gyre Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DiaMedica Therapeutics and Gyre Therapeutics
The main advantage of trading using opposite DiaMedica Therapeutics and Gyre Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DiaMedica Therapeutics position performs unexpectedly, Gyre 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 Gyre Therapeutics will offset losses from the drop in Gyre Therapeutics' long position.| DiaMedica Therapeutics vs. Milestone Pharmaceuticals | DiaMedica Therapeutics vs. Seres Therapeutics | DiaMedica Therapeutics vs. Inhibikase Therapeutics | DiaMedica Therapeutics vs. Oncolytics Biotech |
| Gyre Therapeutics vs. DiaMedica Therapeutics | Gyre Therapeutics vs. Lyra Therapeutics | Gyre Therapeutics vs. Centessa Pharmaceuticals 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stocks Directory Find actively traded stocks across global markets |