Correlation Between Kronos Bio and Ocean Biomedical
Can any of the company-specific risk be diversified away by investing in both Kronos Bio and Ocean Biomedical 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 Kronos Bio and Ocean Biomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kronos Bio and Ocean Biomedical, you can compare the effects of market volatilities on Kronos Bio and Ocean Biomedical 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 Kronos Bio with a short position of Ocean Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kronos Bio and Ocean Biomedical.
Diversification Opportunities for Kronos Bio and Ocean Biomedical
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kronos and Ocean is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Kronos Bio and Ocean Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Biomedical and Kronos 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 Kronos Bio are associated (or correlated) with Ocean Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Biomedical has no effect on the direction of Kronos Bio i.e., Kronos Bio and Ocean Biomedical go up and down completely randomly.
Pair Corralation between Kronos Bio and Ocean Biomedical
Given the investment horizon of 90 days Kronos Bio is expected to generate 3.02 times less return on investment than Ocean Biomedical. But when comparing it to its historical volatility, Kronos Bio is 3.0 times less risky than Ocean Biomedical. It trades about 0.02 of its potential returns per unit of risk. Ocean Biomedical is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 55.00 in Ocean Biomedical on November 5, 2024 and sell it today you would lose (37.00) from holding Ocean Biomedical or give up 67.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kronos Bio vs. Ocean Biomedical
Performance |
| Timeline |
| Kronos Bio |
| Ocean Biomedical |
Kronos Bio and Ocean Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kronos Bio and Ocean Biomedical
The main advantage of trading using opposite Kronos Bio and Ocean Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kronos Bio position performs unexpectedly, Ocean Biomedical 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 Ocean Biomedical will offset losses from the drop in Ocean Biomedical's long position.| Kronos Bio vs. Cyclerion Therapeutics | Kronos Bio vs. Larimar Therapeutics | Kronos Bio vs. Addex Therapeutics | Kronos Bio vs. Achilles Therapeutics PLC |
| Ocean Biomedical vs. Enveric Biosciences | Ocean Biomedical vs. Hepion Pharmaceuticals | Ocean Biomedical vs. Elevation Oncology | Ocean Biomedical vs. Zura Bio Limited |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |