Correlation Between Monopar Therapeutics and Bridgetown Holdings
Can any of the company-specific risk be diversified away by investing in both Monopar Therapeutics and Bridgetown Holdings 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 Monopar Therapeutics and Bridgetown Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monopar Therapeutics and Bridgetown Holdings, you can compare the effects of market volatilities on Monopar Therapeutics and Bridgetown Holdings 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 Monopar Therapeutics with a short position of Bridgetown Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monopar Therapeutics and Bridgetown Holdings.
Diversification Opportunities for Monopar Therapeutics and Bridgetown Holdings
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Monopar and Bridgetown is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Monopar Therapeutics and Bridgetown Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgetown Holdings and Monopar 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 Monopar Therapeutics are associated (or correlated) with Bridgetown Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgetown Holdings has no effect on the direction of Monopar Therapeutics i.e., Monopar Therapeutics and Bridgetown Holdings go up and down completely randomly.
Pair Corralation between Monopar Therapeutics and Bridgetown Holdings
Given the investment horizon of 90 days Monopar Therapeutics is expected to generate 238.71 times more return on investment than Bridgetown Holdings. However, Monopar Therapeutics is 238.71 times more volatile than Bridgetown Holdings. It trades about 0.05 of its potential returns per unit of risk. Bridgetown Holdings is currently generating about 0.21 per unit of risk. If you would invest 1,720 in Monopar Therapeutics on October 25, 2024 and sell it today you would earn a total of 2,212 from holding Monopar Therapeutics or generate 128.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 23.89% |
| Values | Daily Returns |
Monopar Therapeutics vs. Bridgetown Holdings
Performance |
| Timeline |
| Monopar Therapeutics |
| Bridgetown Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Monopar Therapeutics and Bridgetown Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monopar Therapeutics and Bridgetown Holdings
The main advantage of trading using opposite Monopar Therapeutics and Bridgetown Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monopar Therapeutics position performs unexpectedly, Bridgetown Holdings 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 Bridgetown Holdings will offset losses from the drop in Bridgetown Holdings' long position.| Monopar Therapeutics vs. Anebulo Pharmaceuticals | Monopar Therapeutics vs. Acrivon Therapeutics, Common | Monopar Therapeutics vs. Pmv Pharmaceuticals | Monopar Therapeutics vs. Molecular Partners AG |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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