Correlation Between Magnite and Zura Bio
Can any of the company-specific risk be diversified away by investing in both Magnite and Zura Bio 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 Magnite and Zura Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magnite and Zura Bio Limited, you can compare the effects of market volatilities on Magnite and Zura Bio 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 Magnite with a short position of Zura Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magnite and Zura Bio.
Diversification Opportunities for Magnite and Zura Bio
Pay attention - limited upside
The 3 months correlation between Magnite and Zura is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Magnite and Zura Bio Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zura Bio Limited and Magnite 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 Magnite are associated (or correlated) with Zura Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zura Bio Limited has no effect on the direction of Magnite i.e., Magnite and Zura Bio go up and down completely randomly.
Pair Corralation between Magnite and Zura Bio
Given the investment horizon of 90 days Magnite is expected to generate 2.09 times less return on investment than Zura Bio. But when comparing it to its historical volatility, Magnite is 3.97 times less risky than Zura Bio. It trades about 0.04 of its potential returns per unit of risk. Zura Bio Limited is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 816.00 in Zura Bio Limited on September 12, 2024 and sell it today you would lose (538.00) from holding Zura Bio Limited or give up 65.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.28% |
| Values | Daily Returns |
Magnite vs. Zura Bio Limited
Performance |
| Timeline |
| Magnite |
| Zura Bio Limited |
Magnite and Zura Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magnite and Zura Bio
The main advantage of trading using opposite Magnite and Zura Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magnite position performs unexpectedly, Zura Bio 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 Zura Bio will offset losses from the drop in Zura Bio's long position.| Magnite vs. National CineMedia | Magnite vs. Baosheng Media Group | Magnite vs. Townsquare Media | Magnite vs. Dolphin Entertainment |
| Zura Bio vs. NL Industries | Zura Bio vs. Magnite | Zura Bio vs. CarsalesCom Ltd ADR | Zura Bio vs. Eastman Chemical |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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