Correlation Between Stoke Therapeutics and Savara
Can any of the company-specific risk be diversified away by investing in both Stoke Therapeutics and Savara 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 Stoke Therapeutics and Savara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stoke Therapeutics and Savara Inc, you can compare the effects of market volatilities on Stoke Therapeutics and Savara 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 Stoke Therapeutics with a short position of Savara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stoke Therapeutics and Savara.
Diversification Opportunities for Stoke Therapeutics and Savara
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stoke and Savara is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Stoke Therapeutics and Savara Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Savara Inc and Stoke 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 Stoke Therapeutics are associated (or correlated) with Savara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Savara Inc has no effect on the direction of Stoke Therapeutics i.e., Stoke Therapeutics and Savara go up and down completely randomly.
Pair Corralation between Stoke Therapeutics and Savara
Given the investment horizon of 90 days Stoke Therapeutics is expected to generate 1.77 times more return on investment than Savara. However, Stoke Therapeutics is 1.77 times more volatile than Savara Inc. It trades about 0.09 of its potential returns per unit of risk. Savara Inc is currently generating about 0.0 per unit of risk. If you would invest 460.00 in Stoke Therapeutics on September 2, 2024 and sell it today you would earn a total of 751.00 from holding Stoke Therapeutics or generate 163.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stoke Therapeutics vs. Savara Inc
Performance |
| Timeline |
| Stoke Therapeutics |
| Savara Inc |
Stoke Therapeutics and Savara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stoke Therapeutics and Savara
The main advantage of trading using opposite Stoke Therapeutics and Savara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stoke Therapeutics position performs unexpectedly, Savara 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 Savara will offset losses from the drop in Savara's long position.| Stoke Therapeutics vs. Tff Pharmaceuticals | Stoke Therapeutics vs. Eliem Therapeutics | Stoke Therapeutics vs. Inhibrx | Stoke Therapeutics vs. Enliven Therapeutics |
| Savara vs. Stoke Therapeutics | Savara vs. Edgewise Therapeutics | Savara vs. Crinetics Pharmaceuticals | Savara vs. Dyne 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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