Correlation Between Kineta and Tempest Therapeutics
Can any of the company-specific risk be diversified away by investing in both Kineta and Tempest 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 Kineta and Tempest Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kineta Inc and Tempest Therapeutics, you can compare the effects of market volatilities on Kineta and Tempest 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 Kineta with a short position of Tempest Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kineta and Tempest Therapeutics.
Diversification Opportunities for Kineta and Tempest Therapeutics
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kineta and Tempest is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Kineta Inc and Tempest Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tempest Therapeutics and Kineta 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 Kineta Inc are associated (or correlated) with Tempest Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tempest Therapeutics has no effect on the direction of Kineta i.e., Kineta and Tempest Therapeutics go up and down completely randomly.
Pair Corralation between Kineta and Tempest Therapeutics
Allowing for the 90-day total investment horizon Kineta Inc is expected to generate 1.61 times more return on investment than Tempest Therapeutics. However, Kineta is 1.61 times more volatile than Tempest Therapeutics. It trades about -0.03 of its potential returns per unit of risk. Tempest Therapeutics is currently generating about -0.07 per unit of risk. If you would invest 251.00 in Kineta Inc on November 3, 2024 and sell it today you would lose (203.00) from holding Kineta Inc or give up 80.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 81.05% |
| Values | Daily Returns |
Kineta Inc vs. Tempest Therapeutics
Performance |
| Timeline |
| Kineta Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Tempest Therapeutics |
Kineta and Tempest Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kineta and Tempest Therapeutics
The main advantage of trading using opposite Kineta and Tempest Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kineta position performs unexpectedly, Tempest 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 Tempest Therapeutics will offset losses from the drop in Tempest Therapeutics' long position.| Kineta vs. Rezolute | Kineta vs. XOMA Corporation | Kineta vs. Protagenic Therapeutics | Kineta vs. Tempest Therapeutics |
| Tempest Therapeutics vs. Indaptus Therapeutics | Tempest Therapeutics vs. Rezolute | Tempest Therapeutics vs. Forte Biosciences | Tempest Therapeutics vs. Sana Biotechnology |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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