Correlation Between Sanofi ADR and Protagonist Therapeutics
Can any of the company-specific risk be diversified away by investing in both Sanofi ADR and Protagonist 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 Sanofi ADR and Protagonist Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanofi ADR and Protagonist Therapeutics, you can compare the effects of market volatilities on Sanofi ADR and Protagonist 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 Sanofi ADR with a short position of Protagonist Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanofi ADR and Protagonist Therapeutics.
Diversification Opportunities for Sanofi ADR and Protagonist Therapeutics
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sanofi and Protagonist is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Sanofi ADR and Protagonist Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protagonist Therapeutics and Sanofi ADR 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 Sanofi ADR are associated (or correlated) with Protagonist Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protagonist Therapeutics has no effect on the direction of Sanofi ADR i.e., Sanofi ADR and Protagonist Therapeutics go up and down completely randomly.
Pair Corralation between Sanofi ADR and Protagonist Therapeutics
Considering the 90-day investment horizon Sanofi ADR is expected to generate 0.55 times more return on investment than Protagonist Therapeutics. However, Sanofi ADR is 1.81 times less risky than Protagonist Therapeutics. It trades about 0.24 of its potential returns per unit of risk. Protagonist Therapeutics is currently generating about -0.26 per unit of risk. If you would invest 4,839 in Sanofi ADR on October 23, 2024 and sell it today you would earn a total of 235.00 from holding Sanofi ADR or generate 4.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanofi ADR vs. Protagonist Therapeutics
Performance |
| Timeline |
| Sanofi ADR |
| Protagonist Therapeutics |
Sanofi ADR and Protagonist Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanofi ADR and Protagonist Therapeutics
The main advantage of trading using opposite Sanofi ADR and Protagonist Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanofi ADR position performs unexpectedly, Protagonist 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 Protagonist Therapeutics will offset losses from the drop in Protagonist Therapeutics' long position.| Sanofi ADR vs. DiaMedica Therapeutics | Sanofi ADR vs. Seres Therapeutics | Sanofi ADR vs. Inhibikase Therapeutics | Sanofi ADR vs. Oncolytics Biotech |
| Protagonist Therapeutics vs. Revolution Medicines | Protagonist Therapeutics vs. Akero Therapeutics | Protagonist Therapeutics vs. Avidity Biosciences | Protagonist Therapeutics vs. Stoke 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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