Correlation Between Kineta and XOMA
Can any of the company-specific risk be diversified away by investing in both Kineta and XOMA 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 XOMA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kineta Inc and XOMA Corporation, you can compare the effects of market volatilities on Kineta and XOMA 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 XOMA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kineta and XOMA.
Diversification Opportunities for Kineta and XOMA
Very weak diversification
The 3 months correlation between Kineta and XOMA is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Kineta Inc and XOMA Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XOMA 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 XOMA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XOMA has no effect on the direction of Kineta i.e., Kineta and XOMA go up and down completely randomly.
Pair Corralation between Kineta and XOMA
Allowing for the 90-day total investment horizon Kineta Inc is expected to under-perform the XOMA. In addition to that, Kineta is 20.49 times more volatile than XOMA Corporation. It trades about -0.03 of its total potential returns per unit of risk. XOMA Corporation is currently generating about 0.09 per unit of volatility. If you would invest 2,277 in XOMA Corporation on November 3, 2024 and sell it today you would earn a total of 258.00 from holding XOMA Corporation or generate 11.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 81.38% |
| Values | Daily Returns |
Kineta Inc vs. XOMA Corp.
Performance |
| Timeline |
| Kineta Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| XOMA |
Kineta and XOMA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kineta and XOMA
The main advantage of trading using opposite Kineta and XOMA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kineta position performs unexpectedly, XOMA 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 XOMA will offset losses from the drop in XOMA's long position.| Kineta vs. Rezolute | Kineta vs. XOMA Corporation | Kineta vs. Protagenic Therapeutics | Kineta vs. Tempest 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 Stocks Directory module to find actively traded stocks across global markets.
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