Correlation Between Evogene and Kamada
Can any of the company-specific risk be diversified away by investing in both Evogene and Kamada 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 Evogene and Kamada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evogene and Kamada, you can compare the effects of market volatilities on Evogene and Kamada 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 Evogene with a short position of Kamada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evogene and Kamada.
Diversification Opportunities for Evogene and Kamada
Excellent diversification
The 3 months correlation between Evogene and Kamada is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Evogene and Kamada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kamada and Evogene 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 Evogene are associated (or correlated) with Kamada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kamada has no effect on the direction of Evogene i.e., Evogene and Kamada go up and down completely randomly.
Pair Corralation between Evogene and Kamada
Given the investment horizon of 90 days Evogene is expected to under-perform the Kamada. In addition to that, Evogene is 2.27 times more volatile than Kamada. It trades about -0.04 of its total potential returns per unit of risk. Kamada is currently generating about 0.03 per unit of volatility. If you would invest 175,400 in Kamada on September 3, 2024 and sell it today you would earn a total of 35,200 from holding Kamada or generate 20.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 77.47% |
| Values | Daily Returns |
Evogene vs. Kamada
Performance |
| Timeline |
| Evogene |
| Kamada |
Evogene and Kamada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evogene and Kamada
The main advantage of trading using opposite Evogene and Kamada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evogene position performs unexpectedly, Kamada 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 Kamada will offset losses from the drop in Kamada's long position.| Evogene vs. Arcus Biosciences | Evogene vs. Fate Therapeutics | Evogene vs. Pluri Inc | Evogene vs. Lexaria Bioscience Corp |
| Kamada vs. Kamada | Kamada vs. Teva Pharmaceutical Industries | Kamada vs. Tower Semiconductor | Kamada vs. Elbit Systems |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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