Correlation Between Pasithea Therapeutics and Blueprint Medicines
Can any of the company-specific risk be diversified away by investing in both Pasithea Therapeutics and Blueprint Medicines 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 Pasithea Therapeutics and Blueprint Medicines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pasithea Therapeutics Corp and Blueprint Medicines Corp, you can compare the effects of market volatilities on Pasithea Therapeutics and Blueprint Medicines 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 Pasithea Therapeutics with a short position of Blueprint Medicines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pasithea Therapeutics and Blueprint Medicines.
Diversification Opportunities for Pasithea Therapeutics and Blueprint Medicines
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pasithea and Blueprint is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Pasithea Therapeutics Corp and Blueprint Medicines Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blueprint Medicines Corp and Pasithea Therapeutics 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 Pasithea Therapeutics Corp are associated (or correlated) with Blueprint Medicines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blueprint Medicines Corp has no effect on the direction of Pasithea Therapeutics i.e., Pasithea Therapeutics and Blueprint Medicines go up and down completely randomly.
Pair Corralation between Pasithea Therapeutics and Blueprint Medicines
Given the investment horizon of 90 days Pasithea Therapeutics Corp is expected to under-perform the Blueprint Medicines. But the stock apears to be less risky and, when comparing its historical volatility, Pasithea Therapeutics Corp is 1.09 times less risky than Blueprint Medicines. The stock trades about -0.13 of its potential returns per unit of risk. The Blueprint Medicines Corp is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 9,162 in Blueprint Medicines Corp on October 26, 2024 and sell it today you would earn a total of 2,401 from holding Blueprint Medicines Corp or generate 26.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Pasithea Therapeutics Corp vs. Blueprint Medicines Corp
Performance |
| Timeline |
| Pasithea Therapeutics |
| Blueprint Medicines Corp |
Pasithea Therapeutics and Blueprint Medicines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pasithea Therapeutics and Blueprint Medicines
The main advantage of trading using opposite Pasithea Therapeutics and Blueprint Medicines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pasithea Therapeutics position performs unexpectedly, Blueprint Medicines 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 Blueprint Medicines will offset losses from the drop in Blueprint Medicines' long position.| Pasithea Therapeutics vs. Nutriband Warrant | Pasithea Therapeutics vs. MediciNova | Pasithea Therapeutics vs. Virax Biolabs Group | Pasithea Therapeutics vs. Revelation Biosciences |
| Blueprint Medicines vs. Surrozen | Blueprint Medicines vs. Armata Pharmaceuticals | Blueprint Medicines vs. Pasithea Therapeutics Corp | Blueprint Medicines vs. Aditxt Inc |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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