Correlation Between Protagenic Therapeutics and Histogen
Can any of the company-specific risk be diversified away by investing in both Protagenic Therapeutics and Histogen 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 Protagenic Therapeutics and Histogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Protagenic Therapeutics and Histogen, you can compare the effects of market volatilities on Protagenic Therapeutics and Histogen 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 Protagenic Therapeutics with a short position of Histogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Protagenic Therapeutics and Histogen.
Diversification Opportunities for Protagenic Therapeutics and Histogen
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Protagenic and Histogen is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Protagenic Therapeutics and Histogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Histogen and Protagenic Therapeutics 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 Protagenic Therapeutics are associated (or correlated) with Histogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Histogen has no effect on the direction of Protagenic Therapeutics i.e., Protagenic Therapeutics and Histogen go up and down completely randomly.
Pair Corralation between Protagenic Therapeutics and Histogen
Given the investment horizon of 90 days Protagenic Therapeutics is expected to under-perform the Histogen. But the stock apears to be less risky and, when comparing its historical volatility, Protagenic Therapeutics is 1.95 times less risky than Histogen. The stock trades about -0.01 of its potential returns per unit of risk. The Histogen is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 34.00 in Histogen on November 3, 2024 and sell it today you would lose (31.30) from holding Histogen or give up 92.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.79% |
| Values | Daily Returns |
Protagenic Therapeutics vs. Histogen
Performance |
| Timeline |
| Protagenic Therapeutics |
| Histogen |
Protagenic Therapeutics and Histogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Protagenic Therapeutics and Histogen
The main advantage of trading using opposite Protagenic Therapeutics and Histogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Protagenic Therapeutics position performs unexpectedly, Histogen 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 Histogen will offset losses from the drop in Histogen's long position.| Protagenic Therapeutics vs. Sino Biopharmaceutical Ltd | Protagenic Therapeutics vs. Eledon Pharmaceuticals | Protagenic Therapeutics vs. Rezolute | Protagenic Therapeutics vs. XOMA Corporation |
| Histogen vs. Virax Biolabs Group | Histogen vs. Artelo Biosciences | Histogen vs. Curis Inc | Histogen vs. SAB Biotherapeutics |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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