Correlation Between NextCure and Shattuck Labs
Can any of the company-specific risk be diversified away by investing in both NextCure and Shattuck Labs 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 NextCure and Shattuck Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NextCure and Shattuck Labs, you can compare the effects of market volatilities on NextCure and Shattuck Labs 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 NextCure with a short position of Shattuck Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of NextCure and Shattuck Labs.
Diversification Opportunities for NextCure and Shattuck Labs
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NextCure and Shattuck is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding NextCure and Shattuck Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shattuck Labs and NextCure 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 NextCure are associated (or correlated) with Shattuck Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shattuck Labs has no effect on the direction of NextCure i.e., NextCure and Shattuck Labs go up and down completely randomly.
Pair Corralation between NextCure and Shattuck Labs
Given the investment horizon of 90 days NextCure is expected to generate 0.8 times more return on investment than Shattuck Labs. However, NextCure is 1.26 times less risky than Shattuck Labs. It trades about -0.11 of its potential returns per unit of risk. Shattuck Labs is currently generating about -0.18 per unit of risk. If you would invest 135.00 in NextCure on August 25, 2024 and sell it today you would lose (16.00) from holding NextCure or give up 11.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
NextCure vs. Shattuck Labs
Performance |
| Timeline |
| NextCure |
| Shattuck Labs |
NextCure and Shattuck Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NextCure and Shattuck Labs
The main advantage of trading using opposite NextCure and Shattuck Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NextCure position performs unexpectedly, Shattuck Labs 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 Shattuck Labs will offset losses from the drop in Shattuck Labs' long position.| NextCure vs. CytomX Therapeutics | NextCure vs. Spero Therapeutics | NextCure vs. Instil Bio | NextCure vs. Assembly Biosciences |
| Shattuck Labs vs. C4 Therapeutics | Shattuck Labs vs. Eliem Therapeutics | Shattuck Labs vs. Prelude Therapeutics | Shattuck Labs vs. Monte Rosa Therapeutics |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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