Correlation Between MeiraGTx Holdings and Keros Therapeutics
Can any of the company-specific risk be diversified away by investing in both MeiraGTx Holdings and Keros Therapeutics 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 MeiraGTx Holdings and Keros Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MeiraGTx Holdings PLC and Keros Therapeutics, you can compare the effects of market volatilities on MeiraGTx Holdings and Keros Therapeutics 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 MeiraGTx Holdings with a short position of Keros Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeiraGTx Holdings and Keros Therapeutics.
Diversification Opportunities for MeiraGTx Holdings and Keros Therapeutics
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MeiraGTx and Keros is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding MeiraGTx Holdings PLC and Keros Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keros Therapeutics and MeiraGTx Holdings 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 MeiraGTx Holdings PLC are associated (or correlated) with Keros Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keros Therapeutics has no effect on the direction of MeiraGTx Holdings i.e., MeiraGTx Holdings and Keros Therapeutics go up and down completely randomly.
Pair Corralation between MeiraGTx Holdings and Keros Therapeutics
Given the investment horizon of 90 days MeiraGTx Holdings PLC is expected to generate 1.21 times more return on investment than Keros Therapeutics. However, MeiraGTx Holdings is 1.21 times more volatile than Keros Therapeutics. It trades about 0.03 of its potential returns per unit of risk. Keros Therapeutics is currently generating about -0.09 per unit of risk. If you would invest 585.00 in MeiraGTx Holdings PLC on August 24, 2024 and sell it today you would earn a total of 7.00 from holding MeiraGTx Holdings PLC or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MeiraGTx Holdings PLC vs. Keros Therapeutics
Performance |
| Timeline |
| MeiraGTx Holdings PLC |
| Keros Therapeutics |
MeiraGTx Holdings and Keros Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MeiraGTx Holdings and Keros Therapeutics
The main advantage of trading using opposite MeiraGTx Holdings and Keros Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeiraGTx Holdings position performs unexpectedly, Keros Therapeutics 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 Keros Therapeutics will offset losses from the drop in Keros Therapeutics' long position.| MeiraGTx Holdings vs. Ideaya Biosciences | MeiraGTx Holdings vs. AnaptysBio | MeiraGTx Holdings vs. Keros Therapeutics | MeiraGTx Holdings vs. Uniqure NV |
| Keros Therapeutics vs. Ideaya Biosciences | Keros Therapeutics vs. AnaptysBio | Keros Therapeutics vs. MeiraGTx Holdings PLC | Keros Therapeutics vs. Janux Therapeutics |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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