Correlation Between Nkarta and CEL SCI
Can any of the company-specific risk be diversified away by investing in both Nkarta and CEL SCI 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 CEL SCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nkarta Inc and CEL SCI Corp, you can compare the effects of market volatilities on Nkarta and CEL SCI 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 CEL SCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nkarta and CEL SCI.
Diversification Opportunities for Nkarta and CEL SCI
Very poor diversification
The 3 months correlation between Nkarta and CEL is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Nkarta Inc and CEL SCI Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEL SCI Corp 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 CEL SCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEL SCI Corp has no effect on the direction of Nkarta i.e., Nkarta and CEL SCI go up and down completely randomly.
Pair Corralation between Nkarta and CEL SCI
Given the investment horizon of 90 days Nkarta Inc is expected to generate 1.58 times more return on investment than CEL SCI. However, Nkarta is 1.58 times more volatile than CEL SCI Corp. It trades about 0.02 of its potential returns per unit of risk. CEL SCI Corp is currently generating about -0.03 per unit of risk. If you would invest 476.00 in Nkarta Inc on September 2, 2024 and sell it today you would lose (189.00) from holding Nkarta Inc or give up 39.71% 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. CEL SCI Corp
Performance |
| Timeline |
| Nkarta Inc |
| CEL SCI Corp |
Nkarta and CEL SCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nkarta and CEL SCI
The main advantage of trading using opposite Nkarta and CEL SCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nkarta position performs unexpectedly, CEL SCI 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 CEL SCI will offset losses from the drop in CEL SCI's long position.| Nkarta vs. Monte Rosa Therapeutics | Nkarta vs. Lyell Immunopharma | Nkarta vs. Generation Bio Co | Nkarta vs. Sana Biotechnology |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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