Correlation Between Puma Biotechnology and Sana Biotechnology
Can any of the company-specific risk be diversified away by investing in both Puma Biotechnology and Sana Biotechnology 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 Puma Biotechnology and Sana Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puma Biotechnology and Sana Biotechnology, you can compare the effects of market volatilities on Puma Biotechnology and Sana Biotechnology 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 Puma Biotechnology with a short position of Sana Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puma Biotechnology and Sana Biotechnology.
Diversification Opportunities for Puma Biotechnology and Sana Biotechnology
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Puma and Sana is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Puma Biotechnology and Sana Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sana Biotechnology and Puma Biotechnology 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 Puma Biotechnology are associated (or correlated) with Sana Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sana Biotechnology has no effect on the direction of Puma Biotechnology i.e., Puma Biotechnology and Sana Biotechnology go up and down completely randomly.
Pair Corralation between Puma Biotechnology and Sana Biotechnology
Given the investment horizon of 90 days Puma Biotechnology is expected to generate 0.82 times more return on investment than Sana Biotechnology. However, Puma Biotechnology is 1.23 times less risky than Sana Biotechnology. It trades about 0.02 of its potential returns per unit of risk. Sana Biotechnology is currently generating about -0.13 per unit of risk. If you would invest 297.00 in Puma Biotechnology on September 14, 2024 and sell it today you would lose (5.00) from holding Puma Biotechnology or give up 1.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Puma Biotechnology vs. Sana Biotechnology
Performance |
| Timeline |
| Puma Biotechnology |
| Sana Biotechnology |
Puma Biotechnology and Sana Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puma Biotechnology and Sana Biotechnology
The main advantage of trading using opposite Puma Biotechnology and Sana Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puma Biotechnology position performs unexpectedly, Sana Biotechnology 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 Sana Biotechnology will offset losses from the drop in Sana Biotechnology's long position.| Puma Biotechnology vs. Ultragenyx | Puma Biotechnology vs. Crinetics Pharmaceuticals | Puma Biotechnology vs. Arvinas | Puma Biotechnology vs. Revolution Medicines |
| Sana Biotechnology vs. Puma Biotechnology | Sana Biotechnology vs. Iovance Biotherapeutics | Sana Biotechnology vs. Sarepta Therapeutics | Sana Biotechnology vs. Day One Biopharmaceuticals |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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