Correlation Between SOUTHERN and Aerovate Therapeutics
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By analyzing existing cross correlation between SOUTHERN CALIF GAS and Aerovate Therapeutics, you can compare the effects of market volatilities on SOUTHERN and Aerovate Therapeutics 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 SOUTHERN with a short position of Aerovate Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOUTHERN and Aerovate Therapeutics.
Diversification Opportunities for SOUTHERN and Aerovate Therapeutics
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SOUTHERN and Aerovate is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding SOUTHERN CALIF GAS and Aerovate Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aerovate Therapeutics and SOUTHERN 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 SOUTHERN CALIF GAS are associated (or correlated) with Aerovate Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aerovate Therapeutics has no effect on the direction of SOUTHERN i.e., SOUTHERN and Aerovate Therapeutics go up and down completely randomly.
Pair Corralation between SOUTHERN and Aerovate Therapeutics
Assuming the 90 days trading horizon SOUTHERN CALIF GAS is expected to generate 21.79 times more return on investment than Aerovate Therapeutics. However, SOUTHERN is 21.79 times more volatile than Aerovate Therapeutics. It trades about 0.12 of its potential returns per unit of risk. Aerovate Therapeutics is currently generating about 0.0 per unit of risk. If you would invest 7,974 in SOUTHERN CALIF GAS on September 12, 2024 and sell it today you would earn a total of 602.00 from holding SOUTHERN CALIF GAS or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 56.97% |
| Values | Daily Returns |
SOUTHERN CALIF GAS vs. Aerovate Therapeutics
Performance |
| Timeline |
| SOUTHERN CALIF GAS |
| Aerovate Therapeutics |
SOUTHERN and Aerovate Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOUTHERN and Aerovate Therapeutics
The main advantage of trading using opposite SOUTHERN and Aerovate Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOUTHERN position performs unexpectedly, Aerovate Therapeutics 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 Aerovate Therapeutics will offset losses from the drop in Aerovate Therapeutics' long position.| SOUTHERN vs. AEP TEX INC | SOUTHERN vs. US BANK NATIONAL | SOUTHERN vs. PayPal Holdings | SOUTHERN vs. Alphabet Inc Class C |
| Aerovate Therapeutics vs. Adagene | Aerovate Therapeutics vs. Acrivon Therapeutics, Common | Aerovate Therapeutics vs. Rezolute | Aerovate Therapeutics vs. AN2 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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