Correlation Between Nkarta and Curis
Can any of the company-specific risk be diversified away by investing in both Nkarta and Curis 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 Curis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nkarta Inc and Curis Inc, you can compare the effects of market volatilities on Nkarta and Curis 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 Curis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nkarta and Curis.
Diversification Opportunities for Nkarta and Curis
Very poor diversification
The 3 months correlation between Nkarta and Curis is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Nkarta Inc and Curis Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curis Inc 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 Curis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curis Inc has no effect on the direction of Nkarta i.e., Nkarta and Curis go up and down completely randomly.
Pair Corralation between Nkarta and Curis
Given the investment horizon of 90 days Nkarta Inc is expected to under-perform the Curis. In addition to that, Nkarta is 1.08 times more volatile than Curis Inc. It trades about -0.28 of its total potential returns per unit of risk. Curis Inc is currently generating about -0.21 per unit of volatility. If you would invest 492.00 in Curis Inc on August 29, 2024 and sell it today you would lose (89.00) from holding Curis Inc or give up 18.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nkarta Inc vs. Curis Inc
Performance |
| Timeline |
| Nkarta Inc |
| Curis Inc |
Nkarta and Curis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nkarta and Curis
The main advantage of trading using opposite Nkarta and Curis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nkarta position performs unexpectedly, Curis 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 Curis will offset losses from the drop in Curis' long position.The idea behind Nkarta Inc and Curis Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Curis vs. Aileron Therapeutics | Curis vs. Artelo Biosciences | Curis vs. Histogen | Curis vs. X4 Pharmaceuticals |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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