Correlation Between Kronos Bio and Zura Bio
Can any of the company-specific risk be diversified away by investing in both Kronos Bio and Zura Bio 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 Zura Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kronos Bio and Zura Bio Limited, you can compare the effects of market volatilities on Kronos Bio and Zura Bio 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 Zura Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kronos Bio and Zura Bio.
Diversification Opportunities for Kronos Bio and Zura Bio
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kronos and Zura is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Kronos Bio and Zura Bio Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zura Bio Limited 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 Zura Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zura Bio Limited has no effect on the direction of Kronos Bio i.e., Kronos Bio and Zura Bio go up and down completely randomly.
Pair Corralation between Kronos Bio and Zura Bio
Given the investment horizon of 90 days Kronos Bio is expected to generate 0.9 times more return on investment than Zura Bio. However, Kronos Bio is 1.11 times less risky than Zura Bio. It trades about 0.02 of its potential returns per unit of risk. Zura Bio Limited is currently generating about -0.03 per unit of risk. If you would invest 106.00 in Kronos Bio on November 5, 2024 and sell it today you would lose (8.00) from holding Kronos Bio or give up 7.55% 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. Zura Bio Limited
Performance |
| Timeline |
| Kronos Bio |
| Zura Bio Limited |
Kronos Bio and Zura Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kronos Bio and Zura Bio
The main advantage of trading using opposite Kronos Bio and Zura Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kronos Bio position performs unexpectedly, Zura Bio 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 Zura Bio will offset losses from the drop in Zura Bio's long position.| Kronos Bio vs. Cyclerion Therapeutics | Kronos Bio vs. Larimar Therapeutics | Kronos Bio vs. Addex Therapeutics | Kronos Bio vs. Achilles Therapeutics PLC |
| Zura Bio vs. NetSol Technologies | Zura Bio vs. ServiceNow | Zura Bio vs. Primo Brands | Zura Bio vs. Kingdee International Software |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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