Correlation Between Kezar Life and Elevation Oncology
Can any of the company-specific risk be diversified away by investing in both Kezar Life and Elevation Oncology 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 Elevation Oncology 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 Elevation Oncology, you can compare the effects of market volatilities on Kezar Life and Elevation Oncology 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 Elevation Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and Elevation Oncology.
Diversification Opportunities for Kezar Life and Elevation Oncology
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kezar and Elevation is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences and Elevation Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elevation Oncology 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 Elevation Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elevation Oncology has no effect on the direction of Kezar Life i.e., Kezar Life and Elevation Oncology go up and down completely randomly.
Pair Corralation between Kezar Life and Elevation Oncology
Considering the 90-day investment horizon Kezar Life Sciences is expected to generate 0.6 times more return on investment than Elevation Oncology. However, Kezar Life Sciences is 1.66 times less risky than Elevation Oncology. It trades about -0.02 of its potential returns per unit of risk. Elevation Oncology is currently generating about -0.05 per unit of risk. If you would invest 953.00 in Kezar Life Sciences on November 5, 2024 and sell it today you would lose (305.00) from holding Kezar Life Sciences or give up 32.0% 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. Elevation Oncology
Performance |
| Timeline |
| Kezar Life Sciences |
| Elevation Oncology |
Kezar Life and Elevation Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and Elevation Oncology
The main advantage of trading using opposite Kezar Life and Elevation Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life position performs unexpectedly, Elevation Oncology 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 Elevation Oncology will offset losses from the drop in Elevation Oncology's long position.| Kezar Life vs. Century Therapeutics | Kezar Life vs. Mineralys Therapeutics, Common | Kezar Life vs. Nkarta Inc | Kezar Life vs. Surrozen |
| Elevation Oncology vs. Ocean Biomedical | Elevation Oncology vs. Zura Bio Limited | Elevation Oncology vs. Enveric Biosciences | Elevation Oncology vs. Hepion 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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