Correlation Between Enliven Therapeutics and Biofrontera Warrants
Can any of the company-specific risk be diversified away by investing in both Enliven Therapeutics and Biofrontera Warrants 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 Enliven Therapeutics and Biofrontera Warrants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enliven Therapeutics and Biofrontera Warrants, you can compare the effects of market volatilities on Enliven Therapeutics and Biofrontera Warrants 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 Enliven Therapeutics with a short position of Biofrontera Warrants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enliven Therapeutics and Biofrontera Warrants.
Diversification Opportunities for Enliven Therapeutics and Biofrontera Warrants
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Enliven and Biofrontera is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Enliven Therapeutics and Biofrontera Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biofrontera Warrants and Enliven 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 Enliven Therapeutics are associated (or correlated) with Biofrontera Warrants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biofrontera Warrants has no effect on the direction of Enliven Therapeutics i.e., Enliven Therapeutics and Biofrontera Warrants go up and down completely randomly.
Pair Corralation between Enliven Therapeutics and Biofrontera Warrants
Given the investment horizon of 90 days Enliven Therapeutics is expected to under-perform the Biofrontera Warrants. But the stock apears to be less risky and, when comparing its historical volatility, Enliven Therapeutics is 11.65 times less risky than Biofrontera Warrants. The stock trades about -0.19 of its potential returns per unit of risk. The Biofrontera Warrants is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 19.00 in Biofrontera Warrants on September 1, 2024 and sell it today you would lose (6.00) from holding Biofrontera Warrants or give up 31.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Enliven Therapeutics vs. Biofrontera Warrants
Performance |
| Timeline |
| Enliven Therapeutics |
| Biofrontera Warrants |
Enliven Therapeutics and Biofrontera Warrants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enliven Therapeutics and Biofrontera Warrants
The main advantage of trading using opposite Enliven Therapeutics and Biofrontera Warrants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enliven Therapeutics position performs unexpectedly, Biofrontera Warrants 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 Biofrontera Warrants will offset losses from the drop in Biofrontera Warrants' long position.| Enliven Therapeutics vs. Pmv Pharmaceuticals | Enliven Therapeutics vs. Cullinan Oncology LLC | Enliven Therapeutics vs. Immuneering Corp | Enliven Therapeutics vs. Aerovate Therapeutics |
| Biofrontera Warrants vs. Tff Pharmaceuticals | Biofrontera Warrants vs. Eliem Therapeutics | Biofrontera Warrants vs. Inhibrx | Biofrontera Warrants vs. Enliven Therapeutics |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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