Correlation Between Monte Rosa and Stoke Therapeutics
Can any of the company-specific risk be diversified away by investing in both Monte Rosa and Stoke 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 Monte Rosa and Stoke Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monte Rosa Therapeutics and Stoke Therapeutics, you can compare the effects of market volatilities on Monte Rosa and Stoke 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 Monte Rosa with a short position of Stoke Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monte Rosa and Stoke Therapeutics.
Diversification Opportunities for Monte Rosa and Stoke Therapeutics
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Monte and Stoke is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Monte Rosa Therapeutics and Stoke Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stoke Therapeutics and Monte Rosa 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 Monte Rosa Therapeutics are associated (or correlated) with Stoke Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stoke Therapeutics has no effect on the direction of Monte Rosa i.e., Monte Rosa and Stoke Therapeutics go up and down completely randomly.
Pair Corralation between Monte Rosa and Stoke Therapeutics
Given the investment horizon of 90 days Monte Rosa Therapeutics is expected to generate 1.03 times more return on investment than Stoke Therapeutics. However, Monte Rosa is 1.03 times more volatile than Stoke Therapeutics. It trades about -0.13 of its potential returns per unit of risk. Stoke Therapeutics is currently generating about -0.18 per unit of risk. If you would invest 651.00 in Monte Rosa Therapeutics on October 20, 2024 and sell it today you would lose (85.00) from holding Monte Rosa Therapeutics or give up 13.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monte Rosa Therapeutics vs. Stoke Therapeutics
Performance |
| Timeline |
| Monte Rosa Therapeutics |
| Stoke Therapeutics |
Monte Rosa and Stoke Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monte Rosa and Stoke Therapeutics
The main advantage of trading using opposite Monte Rosa and Stoke Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monte Rosa position performs unexpectedly, Stoke 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 Stoke Therapeutics will offset losses from the drop in Stoke Therapeutics' long position.| Monte Rosa vs. Agilent Technologies | Monte Rosa vs. Equillium | Monte Rosa vs. 23Andme Holding Co | Monte Rosa vs. DiaMedica Therapeutics |
| Stoke Therapeutics vs. Adaptimmune Therapeutics Plc | Stoke Therapeutics vs. Black Diamond Therapeutics | Stoke Therapeutics vs. Relay Therapeutics | Stoke Therapeutics vs. Pliant 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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