Correlation Between Oncolytics Biotech and Prothena Plc
Can any of the company-specific risk be diversified away by investing in both Oncolytics Biotech and Prothena Plc 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 Oncolytics Biotech and Prothena Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oncolytics Biotech and Prothena plc, you can compare the effects of market volatilities on Oncolytics Biotech and Prothena Plc 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 Oncolytics Biotech with a short position of Prothena Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oncolytics Biotech and Prothena Plc.
Diversification Opportunities for Oncolytics Biotech and Prothena Plc
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Oncolytics and Prothena is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Oncolytics Biotech and Prothena plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prothena plc and Oncolytics Biotech 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 Oncolytics Biotech are associated (or correlated) with Prothena Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prothena plc has no effect on the direction of Oncolytics Biotech i.e., Oncolytics Biotech and Prothena Plc go up and down completely randomly.
Pair Corralation between Oncolytics Biotech and Prothena Plc
Given the investment horizon of 90 days Oncolytics Biotech is expected to under-perform the Prothena Plc. But the stock apears to be less risky and, when comparing its historical volatility, Oncolytics Biotech is 2.0 times less risky than Prothena Plc. The stock trades about -0.4 of its potential returns per unit of risk. The Prothena plc is currently generating about -0.2 of returns per unit of risk over similar time horizon. If you would invest 1,723 in Prothena plc on September 14, 2024 and sell it today you would lose (342.00) from holding Prothena plc or give up 19.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oncolytics Biotech vs. Prothena plc
Performance |
| Timeline |
| Oncolytics Biotech |
| Prothena plc |
Oncolytics Biotech and Prothena Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oncolytics Biotech and Prothena Plc
The main advantage of trading using opposite Oncolytics Biotech and Prothena Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oncolytics Biotech position performs unexpectedly, Prothena Plc 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 Prothena Plc will offset losses from the drop in Prothena Plc's long position.| Oncolytics Biotech vs. Scpharmaceuticals | Oncolytics Biotech vs. Milestone Pharmaceuticals | Oncolytics Biotech vs. Seres Therapeutics | Oncolytics Biotech vs. DiaMedica Therapeutics |
| Prothena Plc vs. Scpharmaceuticals | Prothena Plc vs. Milestone Pharmaceuticals | Prothena Plc vs. Oncolytics Biotech | Prothena Plc vs. Seres 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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