Correlation Between Eloxx Pharmaceuticals and XOMA Corp
Can any of the company-specific risk be diversified away by investing in both Eloxx Pharmaceuticals and XOMA Corp 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 Eloxx Pharmaceuticals and XOMA Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eloxx Pharmaceuticals and XOMA Corp, you can compare the effects of market volatilities on Eloxx Pharmaceuticals and XOMA Corp 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 Eloxx Pharmaceuticals with a short position of XOMA Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eloxx Pharmaceuticals and XOMA Corp.
Diversification Opportunities for Eloxx Pharmaceuticals and XOMA Corp
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eloxx and XOMA is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Eloxx Pharmaceuticals and XOMA Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XOMA Corp and Eloxx 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 Eloxx Pharmaceuticals are associated (or correlated) with XOMA Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XOMA Corp has no effect on the direction of Eloxx Pharmaceuticals i.e., Eloxx Pharmaceuticals and XOMA Corp go up and down completely randomly.
Pair Corralation between Eloxx Pharmaceuticals and XOMA Corp
Given the investment horizon of 90 days Eloxx Pharmaceuticals is expected to generate 19.72 times more return on investment than XOMA Corp. However, Eloxx Pharmaceuticals is 19.72 times more volatile than XOMA Corp. It trades about 0.08 of its potential returns per unit of risk. XOMA Corp is currently generating about 0.05 per unit of risk. If you would invest 342.00 in Eloxx Pharmaceuticals on August 24, 2024 and sell it today you would earn a total of 270.00 from holding Eloxx Pharmaceuticals or generate 78.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 32.06% |
| Values | Daily Returns |
Eloxx Pharmaceuticals vs. XOMA Corp
Performance |
| Timeline |
| Eloxx Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| XOMA Corp |
Eloxx Pharmaceuticals and XOMA Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eloxx Pharmaceuticals and XOMA Corp
The main advantage of trading using opposite Eloxx Pharmaceuticals and XOMA Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eloxx Pharmaceuticals position performs unexpectedly, XOMA Corp 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 XOMA Corp will offset losses from the drop in XOMA Corp's long position.| Eloxx Pharmaceuticals vs. Zura Bio Limited | Eloxx Pharmaceuticals vs. Altamira Therapeutics | Eloxx Pharmaceuticals vs. Immix Biopharma | Eloxx Pharmaceuticals vs. Enveric Biosciences |
| XOMA Corp vs. Harrow Health 8625 | XOMA Corp vs. SiriusPoint | XOMA Corp vs. New York Mortgage | XOMA Corp vs. Sachem Capital Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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