Correlation Between Satsuma Pharmaceuticals and Nuvation Bio
Can any of the company-specific risk be diversified away by investing in both Satsuma Pharmaceuticals and Nuvation 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 Satsuma Pharmaceuticals and Nuvation Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Satsuma Pharmaceuticals and Nuvation Bio, you can compare the effects of market volatilities on Satsuma Pharmaceuticals and Nuvation 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 Satsuma Pharmaceuticals with a short position of Nuvation Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Satsuma Pharmaceuticals and Nuvation Bio.
Diversification Opportunities for Satsuma Pharmaceuticals and Nuvation Bio
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Satsuma and Nuvation is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Satsuma Pharmaceuticals and Nuvation Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuvation Bio and Satsuma Pharmaceuticals 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 Satsuma Pharmaceuticals are associated (or correlated) with Nuvation Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuvation Bio has no effect on the direction of Satsuma Pharmaceuticals i.e., Satsuma Pharmaceuticals and Nuvation Bio go up and down completely randomly.
Pair Corralation between Satsuma Pharmaceuticals and Nuvation Bio
Given the investment horizon of 90 days Satsuma Pharmaceuticals is expected to generate 1.71 times more return on investment than Nuvation Bio. However, Satsuma Pharmaceuticals is 1.71 times more volatile than Nuvation Bio. It trades about 0.07 of its potential returns per unit of risk. Nuvation Bio is currently generating about 0.03 per unit of risk. If you would invest 86.00 in Satsuma Pharmaceuticals on November 2, 2024 and sell it today you would earn a total of 24.00 from holding Satsuma Pharmaceuticals or generate 27.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 16.4% |
| Values | Daily Returns |
Satsuma Pharmaceuticals vs. Nuvation Bio
Performance |
| Timeline |
| Satsuma Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nuvation Bio |
Satsuma Pharmaceuticals and Nuvation Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Satsuma Pharmaceuticals and Nuvation Bio
The main advantage of trading using opposite Satsuma Pharmaceuticals and Nuvation Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Satsuma Pharmaceuticals position performs unexpectedly, Nuvation 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 Nuvation Bio will offset losses from the drop in Nuvation Bio's long position.| Satsuma Pharmaceuticals vs. Erasca Inc | Satsuma Pharmaceuticals vs. Forte Biosciences | Satsuma Pharmaceuticals vs. SAB Biotherapeutics | Satsuma Pharmaceuticals vs. Senti Biosciences |
| Nuvation Bio vs. Assembly Biosciences | Nuvation Bio vs. Instil Bio | Nuvation Bio vs. Achilles Therapeutics PLC | Nuvation Bio vs. NextCure |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |