Correlation Between XOMA Corp and Entera Bio
Can any of the company-specific risk be diversified away by investing in both XOMA Corp and Entera 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 XOMA Corp and Entera Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XOMA Corp and Entera Bio, you can compare the effects of market volatilities on XOMA Corp and Entera 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 XOMA Corp with a short position of Entera Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of XOMA Corp and Entera Bio.
Diversification Opportunities for XOMA Corp and Entera Bio
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between XOMA and Entera is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding XOMA Corp and Entera Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entera Bio and XOMA Corp 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 XOMA Corp are associated (or correlated) with Entera Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entera Bio has no effect on the direction of XOMA Corp i.e., XOMA Corp and Entera Bio go up and down completely randomly.
Pair Corralation between XOMA Corp and Entera Bio
Given the investment horizon of 90 days XOMA Corp is expected to generate 0.98 times more return on investment than Entera Bio. However, XOMA Corp is 1.02 times less risky than Entera Bio. It trades about 0.11 of its potential returns per unit of risk. Entera Bio is currently generating about -0.16 per unit of risk. If you would invest 2,692 in XOMA Corp on August 25, 2024 and sell it today you would earn a total of 328.00 from holding XOMA Corp or generate 12.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XOMA Corp vs. Entera Bio
Performance |
| Timeline |
| XOMA Corp |
| Entera Bio |
XOMA Corp and Entera Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XOMA Corp and Entera Bio
The main advantage of trading using opposite XOMA Corp and Entera Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XOMA Corp position performs unexpectedly, Entera 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 Entera Bio will offset losses from the drop in Entera Bio's long position.| XOMA Corp vs. Werewolf Therapeutics | XOMA Corp vs. Edgewise Therapeutics | XOMA Corp vs. Celcuity LLC | XOMA Corp vs. C4 Therapeutics |
| Entera Bio vs. NLS Pharmaceutics AG | Entera Bio vs. Vaccinex | Entera Bio vs. Alterity Therapeutics | Entera Bio vs. Immutep Ltd ADR |
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.
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