Correlation Between Geron and Elevation Oncology
Can any of the company-specific risk be diversified away by investing in both Geron and Elevation Oncology 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 Geron and Elevation Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geron and Elevation Oncology, you can compare the effects of market volatilities on Geron and Elevation Oncology 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 Geron with a short position of Elevation Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geron and Elevation Oncology.
Diversification Opportunities for Geron and Elevation Oncology
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Geron and Elevation is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Geron and Elevation Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elevation Oncology and Geron 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 Geron are associated (or correlated) with Elevation Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elevation Oncology has no effect on the direction of Geron i.e., Geron and Elevation Oncology go up and down completely randomly.
Pair Corralation between Geron and Elevation Oncology
Given the investment horizon of 90 days Geron is expected to generate 24.63 times less return on investment than Elevation Oncology. But when comparing it to its historical volatility, Geron is 2.24 times less risky than Elevation Oncology. It trades about 0.02 of its potential returns per unit of risk. Elevation Oncology is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 54.00 in Elevation Oncology on September 2, 2024 and sell it today you would earn a total of 10.00 from holding Elevation Oncology or generate 18.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geron vs. Elevation Oncology
Performance |
| Timeline |
| Geron |
| Elevation Oncology |
Geron and Elevation Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geron and Elevation Oncology
The main advantage of trading using opposite Geron and Elevation Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geron position performs unexpectedly, Elevation Oncology 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 Elevation Oncology will offset losses from the drop in Elevation Oncology's long position.| Geron vs. Viking Therapeutics | Geron vs. TG Therapeutics | Geron vs. X4 Pharmaceuticals | Geron vs. PDS Biotechnology Corp |
| Elevation Oncology vs. Ocean Biomedical | Elevation Oncology vs. Zura Bio Limited | Elevation Oncology vs. Enveric Biosciences | Elevation Oncology vs. Hepion Pharmaceuticals |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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