Correlation Between Mereo BioPharma and Agenus
Can any of the company-specific risk be diversified away by investing in both Mereo BioPharma and Agenus 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 Mereo BioPharma and Agenus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mereo BioPharma Group and Agenus Inc, you can compare the effects of market volatilities on Mereo BioPharma and Agenus 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 Mereo BioPharma with a short position of Agenus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mereo BioPharma and Agenus.
Diversification Opportunities for Mereo BioPharma and Agenus
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mereo and Agenus is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Mereo BioPharma Group and Agenus Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agenus Inc and Mereo BioPharma 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 Mereo BioPharma Group are associated (or correlated) with Agenus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agenus Inc has no effect on the direction of Mereo BioPharma i.e., Mereo BioPharma and Agenus go up and down completely randomly.
Pair Corralation between Mereo BioPharma and Agenus
Given the investment horizon of 90 days Mereo BioPharma Group is expected to generate 0.66 times more return on investment than Agenus. However, Mereo BioPharma Group is 1.52 times less risky than Agenus. It trades about 0.05 of its potential returns per unit of risk. Agenus Inc is currently generating about -0.05 per unit of risk. If you would invest 112.00 in Mereo BioPharma Group on January 14, 2025 and sell it today you would earn a total of 83.00 from holding Mereo BioPharma Group or generate 74.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mereo BioPharma Group vs. Agenus Inc
Performance |
| Timeline |
| Mereo BioPharma Group |
| Agenus Inc |
Mereo BioPharma and Agenus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mereo BioPharma and Agenus
The main advantage of trading using opposite Mereo BioPharma and Agenus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mereo BioPharma position performs unexpectedly, Agenus 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 Agenus will offset losses from the drop in Agenus' long position.| Mereo BioPharma vs. Terns Pharmaceuticals | Mereo BioPharma vs. PDS Biotechnology Corp | Mereo BioPharma vs. Inozyme Pharma | Mereo BioPharma vs. Hookipa Pharma |
| Agenus vs. Marker Therapeutics | Agenus vs. Edgewise Therapeutics | Agenus vs. Adaptimmune Therapeutics Plc | Agenus vs. Mereo BioPharma Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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