Correlation Between Spero Therapeutics and Aeglea Bio
Can any of the company-specific risk be diversified away by investing in both Spero Therapeutics and Aeglea Bio 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 Spero Therapeutics and Aeglea Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spero Therapeutics and Aeglea Bio Therapeutics, you can compare the effects of market volatilities on Spero Therapeutics and Aeglea Bio 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 Spero Therapeutics with a short position of Aeglea Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spero Therapeutics and Aeglea Bio.
Diversification Opportunities for Spero Therapeutics and Aeglea Bio
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Spero and Aeglea is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Spero Therapeutics and Aeglea Bio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeglea Bio Therapeutics and Spero 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 Spero Therapeutics are associated (or correlated) with Aeglea Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeglea Bio Therapeutics has no effect on the direction of Spero Therapeutics i.e., Spero Therapeutics and Aeglea Bio go up and down completely randomly.
Pair Corralation between Spero Therapeutics and Aeglea Bio
If you would invest 59.00 in Aeglea Bio Therapeutics on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Aeglea Bio Therapeutics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Spero Therapeutics vs. Aeglea Bio Therapeutics
Performance |
| Timeline |
| Spero Therapeutics |
| Aeglea Bio Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Spero Therapeutics and Aeglea Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spero Therapeutics and Aeglea Bio
The main advantage of trading using opposite Spero Therapeutics and Aeglea Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spero Therapeutics position performs unexpectedly, Aeglea Bio 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 Aeglea Bio will offset losses from the drop in Aeglea Bio's long position.| Spero Therapeutics vs. Assembly Biosciences | Spero Therapeutics vs. Achilles Therapeutics PLC | Spero Therapeutics vs. Instil Bio | Spero Therapeutics vs. CytomX Therapeutics |
| Aeglea Bio vs. Edgewise Therapeutics | Aeglea Bio vs. Ikena Oncology | Aeglea Bio vs. Design Therapeutics | Aeglea Bio vs. Xilio Development |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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