Correlation Between Eterna Therapeutics and Compugen
Can any of the company-specific risk be diversified away by investing in both Eterna Therapeutics and Compugen 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 Compugen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eterna Therapeutics and Compugen, you can compare the effects of market volatilities on Eterna Therapeutics and Compugen 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 Compugen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eterna Therapeutics and Compugen.
Diversification Opportunities for Eterna Therapeutics and Compugen
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eterna and Compugen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Eterna Therapeutics and Compugen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compugen 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 Compugen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compugen has no effect on the direction of Eterna Therapeutics i.e., Eterna Therapeutics and Compugen go up and down completely randomly.
Pair Corralation between Eterna Therapeutics and Compugen
Given the investment horizon of 90 days Eterna Therapeutics is expected to under-perform the Compugen. In addition to that, Eterna Therapeutics is 1.43 times more volatile than Compugen. It trades about -0.19 of its total potential returns per unit of risk. Compugen is currently generating about -0.05 per unit of volatility. If you would invest 219.00 in Compugen on September 1, 2024 and sell it today you would lose (58.00) from holding Compugen or give up 26.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eterna Therapeutics vs. Compugen
Performance |
| Timeline |
| Eterna Therapeutics |
| Compugen |
Eterna Therapeutics and Compugen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eterna Therapeutics and Compugen
The main advantage of trading using opposite Eterna Therapeutics and Compugen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eterna Therapeutics position performs unexpectedly, Compugen 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 Compugen will offset losses from the drop in Compugen's long position.| Eterna Therapeutics vs. Tff Pharmaceuticals | Eterna Therapeutics vs. Eliem Therapeutics | Eterna Therapeutics vs. Inhibrx | Eterna Therapeutics 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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