Correlation Between Nkarta and Evotec SE
Can any of the company-specific risk be diversified away by investing in both Nkarta and Evotec SE 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 Evotec SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nkarta Inc and Evotec SE ADR, you can compare the effects of market volatilities on Nkarta and Evotec SE 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 Evotec SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nkarta and Evotec SE.
Diversification Opportunities for Nkarta and Evotec SE
Good diversification
The 3 months correlation between Nkarta and Evotec is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Nkarta Inc and Evotec SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evotec SE ADR 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 Evotec SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evotec SE ADR has no effect on the direction of Nkarta i.e., Nkarta and Evotec SE go up and down completely randomly.
Pair Corralation between Nkarta and Evotec SE
Given the investment horizon of 90 days Nkarta Inc is expected to generate 2.09 times more return on investment than Evotec SE. However, Nkarta is 2.09 times more volatile than Evotec SE ADR. It trades about 0.02 of its potential returns per unit of risk. Evotec SE ADR is currently generating about -0.01 per unit of risk. If you would invest 486.00 in Nkarta Inc on November 9, 2024 and sell it today you would lose (252.00) from holding Nkarta Inc or give up 51.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nkarta Inc vs. Evotec SE ADR
Performance |
| Timeline |
| Nkarta Inc |
| Evotec SE ADR |
Nkarta and Evotec SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nkarta and Evotec SE
The main advantage of trading using opposite Nkarta and Evotec SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nkarta position performs unexpectedly, Evotec SE 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 Evotec SE will offset losses from the drop in Evotec SE's long position.| Nkarta vs. Monte Rosa Therapeutics | Nkarta vs. Lyell Immunopharma | Nkarta vs. Generation Bio Co | Nkarta vs. Sana Biotechnology |
| Evotec SE vs. Prestige Brand Holdings | Evotec SE vs. Supernus Pharmaceuticals | Evotec SE vs. Collegium Pharmaceutical | Evotec SE vs. ANI 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |