Correlation Between Medicenna Therapeutics and Microbix Biosystems
Can any of the company-specific risk be diversified away by investing in both Medicenna Therapeutics and Microbix Biosystems 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 Medicenna Therapeutics and Microbix Biosystems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medicenna Therapeutics Corp and Microbix Biosystems, you can compare the effects of market volatilities on Medicenna Therapeutics and Microbix Biosystems 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 Medicenna Therapeutics with a short position of Microbix Biosystems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medicenna Therapeutics and Microbix Biosystems.
Diversification Opportunities for Medicenna Therapeutics and Microbix Biosystems
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Medicenna and Microbix is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Medicenna Therapeutics Corp and Microbix Biosystems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbix Biosystems and Medicenna 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 Medicenna Therapeutics Corp are associated (or correlated) with Microbix Biosystems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbix Biosystems has no effect on the direction of Medicenna Therapeutics i.e., Medicenna Therapeutics and Microbix Biosystems go up and down completely randomly.
Pair Corralation between Medicenna Therapeutics and Microbix Biosystems
Assuming the 90 days trading horizon Medicenna Therapeutics Corp is expected to generate 2.21 times more return on investment than Microbix Biosystems. However, Medicenna Therapeutics is 2.21 times more volatile than Microbix Biosystems. It trades about 0.06 of its potential returns per unit of risk. Microbix Biosystems is currently generating about 0.0 per unit of risk. If you would invest 68.00 in Medicenna Therapeutics Corp on August 29, 2024 and sell it today you would earn a total of 110.00 from holding Medicenna Therapeutics Corp or generate 161.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medicenna Therapeutics Corp vs. Microbix Biosystems
Performance |
| Timeline |
| Medicenna Therapeutics |
| Microbix Biosystems |
Medicenna Therapeutics and Microbix Biosystems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medicenna Therapeutics and Microbix Biosystems
The main advantage of trading using opposite Medicenna Therapeutics and Microbix Biosystems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medicenna Therapeutics position performs unexpectedly, Microbix Biosystems 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 Microbix Biosystems will offset losses from the drop in Microbix Biosystems' long position.| Medicenna Therapeutics vs. Aptose Biosciences | Medicenna Therapeutics vs. Oncolytics Biotech | Medicenna Therapeutics vs. Helix BioPharma Corp |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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