Correlation Between Nkarta and Atara Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both Nkarta and Atara Biotherapeutics 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 Nkarta and Atara Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nkarta Inc and Atara Biotherapeutics, you can compare the effects of market volatilities on Nkarta and Atara Biotherapeutics 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 Nkarta with a short position of Atara Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nkarta and Atara Biotherapeutics.
Diversification Opportunities for Nkarta and Atara Biotherapeutics
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nkarta and Atara is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nkarta Inc and Atara Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atara Biotherapeutics and Nkarta 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 Nkarta Inc are associated (or correlated) with Atara Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atara Biotherapeutics has no effect on the direction of Nkarta i.e., Nkarta and Atara Biotherapeutics go up and down completely randomly.
Pair Corralation between Nkarta and Atara Biotherapeutics
Given the investment horizon of 90 days Nkarta Inc is expected to under-perform the Atara Biotherapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Nkarta Inc is 1.6 times less risky than Atara Biotherapeutics. The stock trades about -0.1 of its potential returns per unit of risk. The Atara Biotherapeutics is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 958.00 in Atara Biotherapeutics on August 31, 2024 and sell it today you would earn a total of 260.00 from holding Atara Biotherapeutics or generate 27.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nkarta Inc vs. Atara Biotherapeutics
Performance |
| Timeline |
| Nkarta Inc |
| Atara Biotherapeutics |
Nkarta and Atara Biotherapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nkarta and Atara Biotherapeutics
The main advantage of trading using opposite Nkarta and Atara Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nkarta position performs unexpectedly, Atara Biotherapeutics 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 Atara Biotherapeutics will offset losses from the drop in Atara Biotherapeutics' long position.| Nkarta vs. Monte Rosa Therapeutics | Nkarta vs. Lyell Immunopharma | Nkarta vs. Generation Bio Co | Nkarta vs. Sana Biotechnology |
| Atara Biotherapeutics vs. Fate Therapeutics | Atara Biotherapeutics vs. Sana Biotechnology | Atara Biotherapeutics vs. Caribou Biosciences | Atara Biotherapeutics vs. Arcus Biosciences |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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