Correlation Between Medicenna Therapeutics and Perimeter Medical
Can any of the company-specific risk be diversified away by investing in both Medicenna Therapeutics and Perimeter Medical 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 Perimeter Medical 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 Perimeter Medical Imaging, you can compare the effects of market volatilities on Medicenna Therapeutics and Perimeter Medical 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 Perimeter Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medicenna Therapeutics and Perimeter Medical.
Diversification Opportunities for Medicenna Therapeutics and Perimeter Medical
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Medicenna and Perimeter is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Medicenna Therapeutics Corp and Perimeter Medical Imaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perimeter Medical Imaging 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 Perimeter Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perimeter Medical Imaging has no effect on the direction of Medicenna Therapeutics i.e., Medicenna Therapeutics and Perimeter Medical go up and down completely randomly.
Pair Corralation between Medicenna Therapeutics and Perimeter Medical
Assuming the 90 days trading horizon Medicenna Therapeutics Corp is expected to generate 1.41 times more return on investment than Perimeter Medical. However, Medicenna Therapeutics is 1.41 times more volatile than Perimeter Medical Imaging. It trades about 0.06 of its potential returns per unit of risk. Perimeter Medical Imaging is currently generating about -0.02 per unit of risk. If you would invest 66.00 in Medicenna Therapeutics Corp on September 2, 2024 and sell it today you would earn a total of 106.00 from holding Medicenna Therapeutics Corp or generate 160.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medicenna Therapeutics Corp vs. Perimeter Medical Imaging
Performance |
| Timeline |
| Medicenna Therapeutics |
| Perimeter Medical Imaging |
Medicenna Therapeutics and Perimeter Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medicenna Therapeutics and Perimeter Medical
The main advantage of trading using opposite Medicenna Therapeutics and Perimeter Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medicenna Therapeutics position performs unexpectedly, Perimeter Medical 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 Perimeter Medical will offset losses from the drop in Perimeter Medical's long position.| Medicenna Therapeutics vs. Aptose Biosciences | Medicenna Therapeutics vs. Oncolytics Biotech | Medicenna Therapeutics vs. Helix BioPharma Corp |
| Perimeter Medical vs. Orca Energy Group | Perimeter Medical vs. Rogers Communications | Perimeter Medical vs. Aclara Resources | Perimeter Medical vs. Greenfire Resources |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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