Correlation Between Sana Biotechnology and Conduit Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Sana Biotechnology and Conduit Pharmaceuticals 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 Sana Biotechnology and Conduit Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sana Biotechnology and Conduit Pharmaceuticals, you can compare the effects of market volatilities on Sana Biotechnology and Conduit Pharmaceuticals 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 Sana Biotechnology with a short position of Conduit Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sana Biotechnology and Conduit Pharmaceuticals.
Diversification Opportunities for Sana Biotechnology and Conduit Pharmaceuticals
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sana and Conduit is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Sana Biotechnology and Conduit Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conduit Pharmaceuticals and Sana 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 Sana Biotechnology are associated (or correlated) with Conduit Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conduit Pharmaceuticals has no effect on the direction of Sana Biotechnology i.e., Sana Biotechnology and Conduit Pharmaceuticals go up and down completely randomly.
Pair Corralation between Sana Biotechnology and Conduit Pharmaceuticals
Given the investment horizon of 90 days Sana Biotechnology is expected to under-perform the Conduit Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Sana Biotechnology is 1.5 times less risky than Conduit Pharmaceuticals. The stock trades about -0.27 of its potential returns per unit of risk. The Conduit Pharmaceuticals is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 9.85 in Conduit Pharmaceuticals on September 4, 2024 and sell it today you would lose (0.16) from holding Conduit Pharmaceuticals or give up 1.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sana Biotechnology vs. Conduit Pharmaceuticals
Performance |
| Timeline |
| Sana Biotechnology |
| Conduit Pharmaceuticals |
Sana Biotechnology and Conduit Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sana Biotechnology and Conduit Pharmaceuticals
The main advantage of trading using opposite Sana Biotechnology and Conduit Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sana Biotechnology position performs unexpectedly, Conduit Pharmaceuticals 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 Conduit Pharmaceuticals will offset losses from the drop in Conduit Pharmaceuticals' long position.| Sana Biotechnology vs. Olema Pharmaceuticals | Sana Biotechnology vs. Cullinan Oncology LLC | Sana Biotechnology vs. Zentalis Pharmaceuticals Llc | Sana Biotechnology vs. X4 Pharmaceuticals |
| Conduit Pharmaceuticals vs. Verve Therapeutics | Conduit Pharmaceuticals vs. Beam Therapeutics | Conduit Pharmaceuticals vs. Caribou Biosciences | Conduit Pharmaceuticals vs. Sana Biotechnology |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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