Correlation Between SAB Biotherapeutics and Chimerix
Can any of the company-specific risk be diversified away by investing in both SAB Biotherapeutics and Chimerix 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 SAB Biotherapeutics and Chimerix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SAB Biotherapeutics and Chimerix, you can compare the effects of market volatilities on SAB Biotherapeutics and Chimerix 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 SAB Biotherapeutics with a short position of Chimerix. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAB Biotherapeutics and Chimerix.
Diversification Opportunities for SAB Biotherapeutics and Chimerix
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SAB and Chimerix is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding SAB Biotherapeutics and Chimerix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chimerix and SAB 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 SAB Biotherapeutics are associated (or correlated) with Chimerix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chimerix has no effect on the direction of SAB Biotherapeutics i.e., SAB Biotherapeutics and Chimerix go up and down completely randomly.
Pair Corralation between SAB Biotherapeutics and Chimerix
Given the investment horizon of 90 days SAB Biotherapeutics is expected to generate 2.42 times more return on investment than Chimerix. However, SAB Biotherapeutics is 2.42 times more volatile than Chimerix. It trades about 0.05 of its potential returns per unit of risk. Chimerix is currently generating about -0.04 per unit of risk. If you would invest 292.00 in SAB Biotherapeutics on August 28, 2024 and sell it today you would earn a total of 5.00 from holding SAB Biotherapeutics or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAB Biotherapeutics vs. Chimerix
Performance |
| Timeline |
| SAB Biotherapeutics |
| Chimerix |
SAB Biotherapeutics and Chimerix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAB Biotherapeutics and Chimerix
The main advantage of trading using opposite SAB Biotherapeutics and Chimerix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAB Biotherapeutics position performs unexpectedly, Chimerix 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 Chimerix will offset losses from the drop in Chimerix's long position.| SAB Biotherapeutics vs. Processa Pharmaceuticals | SAB Biotherapeutics vs. Third Harmonic Bio | SAB Biotherapeutics vs. Cingulate Warrants | SAB Biotherapeutics vs. Anebulo Pharmaceuticals |
| Chimerix vs. Assembly Biosciences | Chimerix vs. Spero Therapeutics | Chimerix vs. Achilles Therapeutics PLC | Chimerix vs. Instil Bio |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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