Correlation Between Fresh Tracks and SAB Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both Fresh Tracks and SAB Biotherapeutics 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 Fresh Tracks and SAB Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresh Tracks Therapeutics and SAB Biotherapeutics, you can compare the effects of market volatilities on Fresh Tracks and SAB Biotherapeutics 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 Fresh Tracks with a short position of SAB Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresh Tracks and SAB Biotherapeutics.
Diversification Opportunities for Fresh Tracks and SAB Biotherapeutics
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fresh and SAB is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fresh Tracks Therapeutics and SAB Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAB Biotherapeutics and Fresh Tracks 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 Fresh Tracks Therapeutics are associated (or correlated) with SAB Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAB Biotherapeutics has no effect on the direction of Fresh Tracks i.e., Fresh Tracks and SAB Biotherapeutics go up and down completely randomly.
Pair Corralation between Fresh Tracks and SAB Biotherapeutics
Given the investment horizon of 90 days Fresh Tracks Therapeutics is expected to under-perform the SAB Biotherapeutics. But the pink sheet apears to be less risky and, when comparing its historical volatility, Fresh Tracks Therapeutics is 12.63 times less risky than SAB Biotherapeutics. The pink sheet trades about -0.05 of its potential returns per unit of risk. The SAB Biotherapeutics is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 5.22 in SAB Biotherapeutics on November 5, 2024 and sell it today you would lose (1.54) from holding SAB Biotherapeutics or give up 29.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 29.13% |
| Values | Daily Returns |
Fresh Tracks Therapeutics vs. SAB Biotherapeutics
Performance |
| Timeline |
| Fresh Tracks Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SAB Biotherapeutics |
Fresh Tracks and SAB Biotherapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresh Tracks and SAB Biotherapeutics
The main advantage of trading using opposite Fresh Tracks and SAB Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresh Tracks position performs unexpectedly, SAB Biotherapeutics 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 SAB Biotherapeutics will offset losses from the drop in SAB Biotherapeutics' long position.| Fresh Tracks vs. Assembly Biosciences | Fresh Tracks vs. Instil Bio | Fresh Tracks vs. Nuvation Bio | Fresh Tracks vs. Achilles Therapeutics PLC |
| SAB Biotherapeutics vs. SAB Biotherapeutics | SAB Biotherapeutics vs. Jasper Therapeutics | SAB Biotherapeutics vs. NRx Pharmaceuticals | SAB Biotherapeutics vs. Surrozen Warrant |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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