Correlation Between Sarepta Therapeutics and Elevation Oncology
Can any of the company-specific risk be diversified away by investing in both Sarepta Therapeutics and Elevation Oncology 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 Sarepta Therapeutics and Elevation Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sarepta Therapeutics and Elevation Oncology, you can compare the effects of market volatilities on Sarepta Therapeutics and Elevation Oncology 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 Sarepta Therapeutics with a short position of Elevation Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sarepta Therapeutics and Elevation Oncology.
Diversification Opportunities for Sarepta Therapeutics and Elevation Oncology
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sarepta and Elevation is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Sarepta Therapeutics and Elevation Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elevation Oncology and Sarepta 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 Sarepta Therapeutics are associated (or correlated) with Elevation Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elevation Oncology has no effect on the direction of Sarepta Therapeutics i.e., Sarepta Therapeutics and Elevation Oncology go up and down completely randomly.
Pair Corralation between Sarepta Therapeutics and Elevation Oncology
Given the investment horizon of 90 days Sarepta Therapeutics is expected to generate 0.64 times more return on investment than Elevation Oncology. However, Sarepta Therapeutics is 1.56 times less risky than Elevation Oncology. It trades about 0.12 of its potential returns per unit of risk. Elevation Oncology is currently generating about 0.01 per unit of risk. If you would invest 11,432 in Sarepta Therapeutics on September 13, 2024 and sell it today you would earn a total of 1,015 from holding Sarepta Therapeutics or generate 8.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sarepta Therapeutics vs. Elevation Oncology
Performance |
| Timeline |
| Sarepta Therapeutics |
| Elevation Oncology |
Sarepta Therapeutics and Elevation Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sarepta Therapeutics and Elevation Oncology
The main advantage of trading using opposite Sarepta Therapeutics and Elevation Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sarepta Therapeutics position performs unexpectedly, Elevation Oncology 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 Elevation Oncology will offset losses from the drop in Elevation Oncology's long position.| Sarepta Therapeutics vs. Puma Biotechnology | Sarepta Therapeutics vs. Iovance Biotherapeutics | Sarepta Therapeutics vs. Day One Biopharmaceuticals | Sarepta Therapeutics vs. Inozyme Pharma |
| Elevation Oncology vs. Puma Biotechnology | Elevation Oncology vs. Iovance Biotherapeutics | Elevation Oncology vs. Sarepta Therapeutics | Elevation Oncology vs. Day One Biopharmaceuticals |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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