Correlation Between TG Therapeutics and Atara Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both TG Therapeutics and Atara Biotherapeutics 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 TG Therapeutics and Atara Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TG Therapeutics and Atara Biotherapeutics, you can compare the effects of market volatilities on TG Therapeutics and Atara Biotherapeutics 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 TG Therapeutics with a short position of Atara Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of TG Therapeutics and Atara Biotherapeutics.
Diversification Opportunities for TG Therapeutics and Atara Biotherapeutics
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TGTX and Atara is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding TG Therapeutics and Atara Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atara Biotherapeutics and TG 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 TG Therapeutics are associated (or correlated) with Atara Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atara Biotherapeutics has no effect on the direction of TG Therapeutics i.e., TG Therapeutics and Atara Biotherapeutics go up and down completely randomly.
Pair Corralation between TG Therapeutics and Atara Biotherapeutics
Given the investment horizon of 90 days TG Therapeutics is expected to generate 0.69 times more return on investment than Atara Biotherapeutics. However, TG Therapeutics is 1.45 times less risky than Atara Biotherapeutics. It trades about 0.08 of its potential returns per unit of risk. Atara Biotherapeutics is currently generating about -0.01 per unit of risk. If you would invest 816.00 in TG Therapeutics on August 26, 2024 and sell it today you would earn a total of 2,691 from holding TG Therapeutics or generate 329.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TG Therapeutics vs. Atara Biotherapeutics
Performance |
| Timeline |
| TG Therapeutics |
| Atara Biotherapeutics |
TG Therapeutics and Atara Biotherapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TG Therapeutics and Atara Biotherapeutics
The main advantage of trading using opposite TG Therapeutics and Atara Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TG Therapeutics position performs unexpectedly, Atara Biotherapeutics 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 Atara Biotherapeutics will offset losses from the drop in Atara Biotherapeutics' long position.| TG Therapeutics vs. Madrigal Pharmaceuticals | TG Therapeutics vs. Terns Pharmaceuticals | TG Therapeutics vs. Hepion Pharmaceuticals | TG Therapeutics vs. Exelixis |
| Atara Biotherapeutics vs. Fate Therapeutics | Atara Biotherapeutics vs. Sana Biotechnology | Atara Biotherapeutics vs. Caribou Biosciences | Atara Biotherapeutics vs. Arcus Biosciences |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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