Correlation Between Viking Therapeutics and Mersana Therapeutics
Can any of the company-specific risk be diversified away by investing in both Viking Therapeutics and Mersana Therapeutics 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 Viking Therapeutics and Mersana Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viking Therapeutics and Mersana Therapeutics, you can compare the effects of market volatilities on Viking Therapeutics and Mersana 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 Viking Therapeutics with a short position of Mersana Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viking Therapeutics and Mersana Therapeutics.
Diversification Opportunities for Viking Therapeutics and Mersana Therapeutics
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Viking and Mersana is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Viking Therapeutics and Mersana Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mersana Therapeutics and Viking 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 Viking Therapeutics are associated (or correlated) with Mersana Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mersana Therapeutics has no effect on the direction of Viking Therapeutics i.e., Viking Therapeutics and Mersana Therapeutics go up and down completely randomly.
Pair Corralation between Viking Therapeutics and Mersana Therapeutics
Given the investment horizon of 90 days Viking Therapeutics is expected to generate 1.19 times more return on investment than Mersana Therapeutics. However, Viking Therapeutics is 1.19 times more volatile than Mersana Therapeutics. It trades about 0.1 of its potential returns per unit of risk. Mersana Therapeutics is currently generating about 0.02 per unit of risk. If you would invest 355.00 in Viking Therapeutics on September 2, 2024 and sell it today you would earn a total of 4,939 from holding Viking Therapeutics or generate 1391.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Viking Therapeutics vs. Mersana Therapeutics
Performance |
| Timeline |
| Viking Therapeutics |
| Mersana Therapeutics |
Viking Therapeutics and Mersana Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viking Therapeutics and Mersana Therapeutics
The main advantage of trading using opposite Viking Therapeutics and Mersana Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viking Therapeutics position performs unexpectedly, Mersana 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 Mersana Therapeutics will offset losses from the drop in Mersana Therapeutics' long position.| Viking Therapeutics vs. Tff Pharmaceuticals | Viking Therapeutics vs. Eliem Therapeutics | Viking Therapeutics vs. Inhibrx | Viking Therapeutics vs. Enliven Therapeutics |
| Mersana Therapeutics vs. Terns Pharmaceuticals | Mersana Therapeutics vs. Amylyx Pharmaceuticals | Mersana Therapeutics vs. Acumen Pharmaceuticals | Mersana Therapeutics vs. Inozyme Pharma |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |