Correlation Between Protalix Biotherapeutics and Sarepta Therapeutics
Can any of the company-specific risk be diversified away by investing in both Protalix Biotherapeutics and Sarepta Therapeutics 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 Protalix Biotherapeutics and Sarepta Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Protalix Biotherapeutics and Sarepta Therapeutics, you can compare the effects of market volatilities on Protalix Biotherapeutics and Sarepta Therapeutics 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 Protalix Biotherapeutics with a short position of Sarepta Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Protalix Biotherapeutics and Sarepta Therapeutics.
Diversification Opportunities for Protalix Biotherapeutics and Sarepta Therapeutics
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Protalix and Sarepta is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Protalix Biotherapeutics and Sarepta Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarepta Therapeutics and Protalix Biotherapeutics 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 Protalix Biotherapeutics are associated (or correlated) with Sarepta Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarepta Therapeutics has no effect on the direction of Protalix Biotherapeutics i.e., Protalix Biotherapeutics and Sarepta Therapeutics go up and down completely randomly.
Pair Corralation between Protalix Biotherapeutics and Sarepta Therapeutics
Considering the 90-day investment horizon Protalix Biotherapeutics is expected to generate 1.48 times more return on investment than Sarepta Therapeutics. However, Protalix Biotherapeutics is 1.48 times more volatile than Sarepta Therapeutics. It trades about 0.49 of its potential returns per unit of risk. Sarepta Therapeutics is currently generating about -0.03 per unit of risk. If you would invest 174.00 in Protalix Biotherapeutics on October 20, 2024 and sell it today you would earn a total of 48.00 from holding Protalix Biotherapeutics or generate 27.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Protalix Biotherapeutics vs. Sarepta Therapeutics
Performance |
| Timeline |
| Protalix Biotherapeutics |
| Sarepta Therapeutics |
Protalix Biotherapeutics and Sarepta Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Protalix Biotherapeutics and Sarepta Therapeutics
The main advantage of trading using opposite Protalix Biotherapeutics and Sarepta Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Protalix Biotherapeutics position performs unexpectedly, Sarepta Therapeutics 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 Sarepta Therapeutics will offset losses from the drop in Sarepta Therapeutics' long position.| Protalix Biotherapeutics vs. Corvus Pharmaceuticals | Protalix Biotherapeutics vs. Aldeyra | Protalix Biotherapeutics vs. Checkpoint Therapeutics | Protalix Biotherapeutics vs. Cidara Therapeutics |
| Sarepta Therapeutics vs. Krystal Biotech | Sarepta Therapeutics vs. PTC Therapeutics | Sarepta Therapeutics vs. Iovance Biotherapeutics | Sarepta Therapeutics vs. Madrigal 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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