Correlation Between Kezar Life and Akanda Corp
Can any of the company-specific risk be diversified away by investing in both Kezar Life and Akanda Corp 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 Kezar Life and Akanda Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kezar Life Sciences and Akanda Corp, you can compare the effects of market volatilities on Kezar Life and Akanda Corp 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 Kezar Life with a short position of Akanda Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and Akanda Corp.
Diversification Opportunities for Kezar Life and Akanda Corp
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kezar and Akanda is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences and Akanda Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akanda Corp and Kezar Life 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 Kezar Life Sciences are associated (or correlated) with Akanda Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akanda Corp has no effect on the direction of Kezar Life i.e., Kezar Life and Akanda Corp go up and down completely randomly.
Pair Corralation between Kezar Life and Akanda Corp
Considering the 90-day investment horizon Kezar Life Sciences is expected to generate 0.5 times more return on investment than Akanda Corp. However, Kezar Life Sciences is 2.01 times less risky than Akanda Corp. It trades about -0.07 of its potential returns per unit of risk. Akanda Corp is currently generating about -0.06 per unit of risk. If you would invest 7,070 in Kezar Life Sciences on August 24, 2024 and sell it today you would lose (6,316) from holding Kezar Life Sciences or give up 89.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kezar Life Sciences vs. Akanda Corp
Performance |
| Timeline |
| Kezar Life Sciences |
| Akanda Corp |
Kezar Life and Akanda Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and Akanda Corp
The main advantage of trading using opposite Kezar Life and Akanda Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life position performs unexpectedly, Akanda Corp 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 Akanda Corp will offset losses from the drop in Akanda Corp's long position.| Kezar Life vs. Lyra Therapeutics | Kezar Life vs. Hookipa Pharma | Kezar Life vs. Cingulate Warrants | Kezar Life vs. SAB Biotherapeutics |
| Akanda Corp vs. China SXT Pharmaceuticals | Akanda Corp vs. Petros Pharmaceuticals | Akanda Corp vs. GelStat Corp | Akanda Corp vs. Shuttle Pharmaceuticals |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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