Correlation Between Gain Therapeutics and Shattuck Labs
Can any of the company-specific risk be diversified away by investing in both Gain Therapeutics and Shattuck Labs 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 Gain Therapeutics and Shattuck Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gain Therapeutics and Shattuck Labs, you can compare the effects of market volatilities on Gain Therapeutics and Shattuck Labs 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 Gain Therapeutics with a short position of Shattuck Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gain Therapeutics and Shattuck Labs.
Diversification Opportunities for Gain Therapeutics and Shattuck Labs
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gain and Shattuck is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Gain Therapeutics and Shattuck Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shattuck Labs and Gain 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 Gain Therapeutics are associated (or correlated) with Shattuck Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shattuck Labs has no effect on the direction of Gain Therapeutics i.e., Gain Therapeutics and Shattuck Labs go up and down completely randomly.
Pair Corralation between Gain Therapeutics and Shattuck Labs
Given the investment horizon of 90 days Gain Therapeutics is expected to under-perform the Shattuck Labs. But the stock apears to be less risky and, when comparing its historical volatility, Gain Therapeutics is 1.72 times less risky than Shattuck Labs. The stock trades about -0.02 of its potential returns per unit of risk. The Shattuck Labs is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 280.00 in Shattuck Labs on August 26, 2024 and sell it today you would lose (180.00) from holding Shattuck Labs or give up 64.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gain Therapeutics vs. Shattuck Labs
Performance |
| Timeline |
| Gain Therapeutics |
| Shattuck Labs |
Gain Therapeutics and Shattuck Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gain Therapeutics and Shattuck Labs
The main advantage of trading using opposite Gain Therapeutics and Shattuck Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gain Therapeutics position performs unexpectedly, Shattuck Labs 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 Shattuck Labs will offset losses from the drop in Shattuck Labs' long position.| Gain Therapeutics vs. Biovie Inc | Gain Therapeutics vs. In8bio Inc | Gain Therapeutics vs. NewAmsterdam Pharma | Gain Therapeutics vs. Cue Biopharma |
| Shattuck Labs vs. C4 Therapeutics | Shattuck Labs vs. Eliem Therapeutics | Shattuck Labs vs. Prelude Therapeutics | Shattuck Labs vs. Monte Rosa 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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