Correlation Between Graphite Bio and MediciNova
Can any of the company-specific risk be diversified away by investing in both Graphite Bio and MediciNova 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 Graphite Bio and MediciNova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graphite Bio and MediciNova, you can compare the effects of market volatilities on Graphite Bio and MediciNova 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 Graphite Bio with a short position of MediciNova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graphite Bio and MediciNova.
Diversification Opportunities for Graphite Bio and MediciNova
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Graphite and MediciNova is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Graphite Bio and MediciNova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MediciNova and Graphite Bio 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 Graphite Bio are associated (or correlated) with MediciNova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MediciNova has no effect on the direction of Graphite Bio i.e., Graphite Bio and MediciNova go up and down completely randomly.
Pair Corralation between Graphite Bio and MediciNova
If you would invest 168.00 in MediciNova on September 1, 2024 and sell it today you would earn a total of 39.00 from holding MediciNova or generate 23.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Graphite Bio vs. MediciNova
Performance |
| Timeline |
| Graphite Bio |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MediciNova |
Graphite Bio and MediciNova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graphite Bio and MediciNova
The main advantage of trading using opposite Graphite Bio and MediciNova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graphite Bio position performs unexpectedly, MediciNova 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 MediciNova will offset losses from the drop in MediciNova's long position.| Graphite Bio vs. Assembly Biosciences | Graphite Bio vs. Instil Bio | Graphite Bio vs. Nuvation Bio | Graphite Bio vs. Achilles Therapeutics PLC |
| MediciNova vs. Cue Biopharma | MediciNova vs. Tff Pharmaceuticals | MediciNova vs. Lantern Pharma | MediciNova vs. Eliem 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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