Correlation Between Eterna Therapeutics and Codexis
Can any of the company-specific risk be diversified away by investing in both Eterna Therapeutics and Codexis 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 Eterna Therapeutics and Codexis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eterna Therapeutics and Codexis, you can compare the effects of market volatilities on Eterna Therapeutics and Codexis 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 Eterna Therapeutics with a short position of Codexis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eterna Therapeutics and Codexis.
Diversification Opportunities for Eterna Therapeutics and Codexis
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eterna and Codexis is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Eterna Therapeutics and Codexis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codexis and Eterna 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 Eterna Therapeutics are associated (or correlated) with Codexis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codexis has no effect on the direction of Eterna Therapeutics i.e., Eterna Therapeutics and Codexis go up and down completely randomly.
Pair Corralation between Eterna Therapeutics and Codexis
Given the investment horizon of 90 days Eterna Therapeutics is expected to under-perform the Codexis. In addition to that, Eterna Therapeutics is 1.55 times more volatile than Codexis. It trades about -0.28 of its total potential returns per unit of risk. Codexis is currently generating about 0.36 per unit of volatility. If you would invest 306.00 in Codexis on August 24, 2024 and sell it today you would earn a total of 127.00 from holding Codexis or generate 41.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Eterna Therapeutics vs. Codexis
Performance |
| Timeline |
| Eterna Therapeutics |
| Codexis |
Eterna Therapeutics and Codexis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eterna Therapeutics and Codexis
The main advantage of trading using opposite Eterna Therapeutics and Codexis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eterna Therapeutics position performs unexpectedly, Codexis 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 Codexis will offset losses from the drop in Codexis' long position.| Eterna Therapeutics vs. Arcus Biosciences | Eterna Therapeutics vs. Cullinan Oncology LLC | Eterna Therapeutics vs. Annexon | Eterna Therapeutics vs. Structure Therapeutics American |
| Codexis vs. Nuvation Bio | Codexis vs. Lyell Immunopharma | Codexis vs. Century Therapeutics | Codexis vs. Generation Bio Co |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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