Correlation Between Fortress Biotech and Checkpoint Therapeutics
Can any of the company-specific risk be diversified away by investing in both Fortress Biotech and Checkpoint Therapeutics 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 Fortress Biotech and Checkpoint Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortress Biotech Pref and Checkpoint Therapeutics, you can compare the effects of market volatilities on Fortress Biotech and Checkpoint Therapeutics 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 Fortress Biotech with a short position of Checkpoint Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortress Biotech and Checkpoint Therapeutics.
Diversification Opportunities for Fortress Biotech and Checkpoint Therapeutics
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fortress and Checkpoint is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Biotech Pref and Checkpoint Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Checkpoint Therapeutics and Fortress Biotech 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 Fortress Biotech Pref are associated (or correlated) with Checkpoint Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Checkpoint Therapeutics has no effect on the direction of Fortress Biotech i.e., Fortress Biotech and Checkpoint Therapeutics go up and down completely randomly.
Pair Corralation between Fortress Biotech and Checkpoint Therapeutics
Assuming the 90 days horizon Fortress Biotech Pref is expected to under-perform the Checkpoint Therapeutics. But the preferred stock apears to be less risky and, when comparing its historical volatility, Fortress Biotech Pref is 2.49 times less risky than Checkpoint Therapeutics. The preferred stock trades about -0.01 of its potential returns per unit of risk. The Checkpoint Therapeutics is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 321.00 in Checkpoint Therapeutics on November 9, 2024 and sell it today you would earn a total of 32.00 from holding Checkpoint Therapeutics or generate 9.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortress Biotech Pref vs. Checkpoint Therapeutics
Performance |
| Timeline |
| Fortress Biotech Pref |
| Checkpoint Therapeutics |
Fortress Biotech and Checkpoint Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortress Biotech and Checkpoint Therapeutics
The main advantage of trading using opposite Fortress Biotech and Checkpoint Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortress Biotech position performs unexpectedly, Checkpoint Therapeutics 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 Checkpoint Therapeutics will offset losses from the drop in Checkpoint Therapeutics' long position.| Fortress Biotech vs. Checkpoint Therapeutics | Fortress Biotech vs. Mustang Bio | Fortress Biotech vs. Reviva Pharmaceuticals Holdings | Fortress Biotech vs. Kodiak Sciences |
| Checkpoint Therapeutics vs. Mustang Bio | Checkpoint Therapeutics vs. Reviva Pharmaceuticals Holdings | Checkpoint Therapeutics vs. Fortress Biotech Pref | Checkpoint Therapeutics vs. Kodiak Sciences |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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