Correlation Between Olema Pharmaceuticals and PepGen
Can any of the company-specific risk be diversified away by investing in both Olema Pharmaceuticals and PepGen 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 Olema Pharmaceuticals and PepGen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Olema Pharmaceuticals and PepGen, you can compare the effects of market volatilities on Olema Pharmaceuticals and PepGen 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 Olema Pharmaceuticals with a short position of PepGen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Olema Pharmaceuticals and PepGen.
Diversification Opportunities for Olema Pharmaceuticals and PepGen
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Olema and PepGen is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Olema Pharmaceuticals and PepGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PepGen and Olema Pharmaceuticals 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 Olema Pharmaceuticals are associated (or correlated) with PepGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PepGen has no effect on the direction of Olema Pharmaceuticals i.e., Olema Pharmaceuticals and PepGen go up and down completely randomly.
Pair Corralation between Olema Pharmaceuticals and PepGen
Given the investment horizon of 90 days Olema Pharmaceuticals is expected to generate 2.88 times less return on investment than PepGen. But when comparing it to its historical volatility, Olema Pharmaceuticals is 1.48 times less risky than PepGen. It trades about 0.01 of its potential returns per unit of risk. PepGen is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 634.00 in PepGen on September 2, 2024 and sell it today you would lose (129.00) from holding PepGen or give up 20.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Olema Pharmaceuticals vs. PepGen
Performance |
| Timeline |
| Olema Pharmaceuticals |
| PepGen |
Olema Pharmaceuticals and PepGen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Olema Pharmaceuticals and PepGen
The main advantage of trading using opposite Olema Pharmaceuticals and PepGen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Olema Pharmaceuticals position performs unexpectedly, PepGen 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 PepGen will offset losses from the drop in PepGen's long position.| Olema Pharmaceuticals vs. Sana Biotechnology | Olema Pharmaceuticals vs. Cullinan Oncology LLC | Olema Pharmaceuticals vs. Zentalis Pharmaceuticals Llc | Olema Pharmaceuticals vs. Molecular Partners AG |
| PepGen vs. Pmv Pharmaceuticals | PepGen vs. Eliem Therapeutics | PepGen vs. MediciNova | PepGen vs. Pharvaris BV |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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