Correlation Between RAPT Therapeutics and Corcept Therapeutics
Can any of the company-specific risk be diversified away by investing in both RAPT Therapeutics and Corcept 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 RAPT Therapeutics and Corcept Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RAPT Therapeutics and Corcept Therapeutics Incorporated, you can compare the effects of market volatilities on RAPT Therapeutics and Corcept 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 RAPT Therapeutics with a short position of Corcept Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of RAPT Therapeutics and Corcept Therapeutics.
Diversification Opportunities for RAPT Therapeutics and Corcept Therapeutics
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RAPT and Corcept is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding RAPT Therapeutics and Corcept Therapeutics Incorpora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corcept Therapeutics and RAPT 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 RAPT Therapeutics are associated (or correlated) with Corcept Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corcept Therapeutics has no effect on the direction of RAPT Therapeutics i.e., RAPT Therapeutics and Corcept Therapeutics go up and down completely randomly.
Pair Corralation between RAPT Therapeutics and Corcept Therapeutics
Given the investment horizon of 90 days RAPT Therapeutics is expected to under-perform the Corcept Therapeutics. In addition to that, RAPT Therapeutics is 3.56 times more volatile than Corcept Therapeutics Incorporated. It trades about -0.21 of its total potential returns per unit of risk. Corcept Therapeutics Incorporated is currently generating about 0.26 per unit of volatility. If you would invest 5,006 in Corcept Therapeutics Incorporated on September 4, 2024 and sell it today you would earn a total of 915.00 from holding Corcept Therapeutics Incorporated or generate 18.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RAPT Therapeutics vs. Corcept Therapeutics Incorpora
Performance |
| Timeline |
| RAPT Therapeutics |
| Corcept Therapeutics |
RAPT Therapeutics and Corcept Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RAPT Therapeutics and Corcept Therapeutics
The main advantage of trading using opposite RAPT Therapeutics and Corcept Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RAPT Therapeutics position performs unexpectedly, Corcept 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 Corcept Therapeutics will offset losses from the drop in Corcept Therapeutics' long position.| RAPT Therapeutics vs. Connect Biopharma Holdings | RAPT Therapeutics vs. Tyra Biosciences | RAPT Therapeutics vs. Xilio Development | RAPT Therapeutics vs. Mineralys Therapeutics, Common |
| Corcept Therapeutics vs. Ideaya Biosciences | Corcept Therapeutics vs. AnaptysBio | Corcept Therapeutics vs. MeiraGTx Holdings PLC | Corcept Therapeutics vs. Keros 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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