Correlation Between Structure Therapeutics and Eterna Therapeutics
Can any of the company-specific risk be diversified away by investing in both Structure Therapeutics and Eterna 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 Structure Therapeutics and Eterna Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Structure Therapeutics American and Eterna Therapeutics, you can compare the effects of market volatilities on Structure Therapeutics and Eterna 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 Structure Therapeutics with a short position of Eterna Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Structure Therapeutics and Eterna Therapeutics.
Diversification Opportunities for Structure Therapeutics and Eterna Therapeutics
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Structure and Eterna is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Structure Therapeutics America and Eterna Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eterna Therapeutics and Structure 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 Structure Therapeutics American are associated (or correlated) with Eterna Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eterna Therapeutics has no effect on the direction of Structure Therapeutics i.e., Structure Therapeutics and Eterna Therapeutics go up and down completely randomly.
Pair Corralation between Structure Therapeutics and Eterna Therapeutics
Given the investment horizon of 90 days Structure Therapeutics American is expected to generate 0.71 times more return on investment than Eterna Therapeutics. However, Structure Therapeutics American is 1.41 times less risky than Eterna Therapeutics. It trades about -0.07 of its potential returns per unit of risk. Eterna Therapeutics is currently generating about -0.42 per unit of risk. If you would invest 3,744 in Structure Therapeutics American on August 28, 2024 and sell it today you would lose (343.00) from holding Structure Therapeutics American or give up 9.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Structure Therapeutics America vs. Eterna Therapeutics
Performance |
| Timeline |
| Structure Therapeutics |
| Eterna Therapeutics |
Structure Therapeutics and Eterna Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Structure Therapeutics and Eterna Therapeutics
The main advantage of trading using opposite Structure Therapeutics and Eterna Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Structure Therapeutics position performs unexpectedly, Eterna 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 Eterna Therapeutics will offset losses from the drop in Eterna Therapeutics' long position.| Structure Therapeutics vs. Eliem Therapeutics | Structure Therapeutics vs. HCW Biologics | Structure Therapeutics vs. Scpharmaceuticals | Structure Therapeutics vs. Milestone Pharmaceuticals |
| Eterna Therapeutics vs. Eliem Therapeutics | Eterna Therapeutics vs. HCW Biologics | Eterna Therapeutics vs. Scpharmaceuticals | Eterna Therapeutics vs. Milestone 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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