Correlation Between Kezar Life and Scisparc
Can any of the company-specific risk be diversified away by investing in both Kezar Life and Scisparc 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 Scisparc 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 Scisparc, you can compare the effects of market volatilities on Kezar Life and Scisparc 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 Scisparc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and Scisparc.
Diversification Opportunities for Kezar Life and Scisparc
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kezar and Scisparc is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences and Scisparc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scisparc 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 Scisparc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scisparc has no effect on the direction of Kezar Life i.e., Kezar Life and Scisparc go up and down completely randomly.
Pair Corralation between Kezar Life and Scisparc
Considering the 90-day investment horizon Kezar Life Sciences is expected to under-perform the Scisparc. But the stock apears to be less risky and, when comparing its historical volatility, Kezar Life Sciences is 2.06 times less risky than Scisparc. The stock trades about -0.03 of its potential returns per unit of risk. The Scisparc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Scisparc on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Scisparc or generate 4.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kezar Life Sciences vs. Scisparc
Performance |
| Timeline |
| Kezar Life Sciences |
| Scisparc |
Kezar Life and Scisparc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and Scisparc
The main advantage of trading using opposite Kezar Life and Scisparc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life position performs unexpectedly, Scisparc 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 Scisparc will offset losses from the drop in Scisparc's long position.| Kezar Life vs. Eliem Therapeutics | Kezar Life vs. HCW Biologics | Kezar Life vs. Scpharmaceuticals | Kezar Life vs. Milestone Pharmaceuticals |
| Scisparc vs. Virax Biolabs Group | Scisparc vs. ZyVersa Therapeutics | Scisparc vs. Unicycive Therapeutics | Scisparc vs. Quoin Pharmaceuticals Ltd |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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