Correlation Between Y MAbs and Madrigal Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Y MAbs and Madrigal Pharmaceuticals 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 Y MAbs and Madrigal Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Y mAbs Therapeutics and Madrigal Pharmaceuticals, you can compare the effects of market volatilities on Y MAbs and Madrigal Pharmaceuticals 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 Y MAbs with a short position of Madrigal Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Y MAbs and Madrigal Pharmaceuticals.
Diversification Opportunities for Y MAbs and Madrigal Pharmaceuticals
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YMAB and Madrigal is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Y mAbs Therapeutics and Madrigal Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Madrigal Pharmaceuticals and Y MAbs 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 Y mAbs Therapeutics are associated (or correlated) with Madrigal Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Madrigal Pharmaceuticals has no effect on the direction of Y MAbs i.e., Y MAbs and Madrigal Pharmaceuticals go up and down completely randomly.
Pair Corralation between Y MAbs and Madrigal Pharmaceuticals
Given the investment horizon of 90 days Y mAbs Therapeutics is expected to under-perform the Madrigal Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Y mAbs Therapeutics is 1.5 times less risky than Madrigal Pharmaceuticals. The stock trades about -0.19 of its potential returns per unit of risk. The Madrigal Pharmaceuticals is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 21,593 in Madrigal Pharmaceuticals on August 31, 2024 and sell it today you would earn a total of 11,552 from holding Madrigal Pharmaceuticals or generate 53.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Y mAbs Therapeutics vs. Madrigal Pharmaceuticals
Performance |
| Timeline |
| Y mAbs Therapeutics |
| Madrigal Pharmaceuticals |
Y MAbs and Madrigal Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Y MAbs and Madrigal Pharmaceuticals
The main advantage of trading using opposite Y MAbs and Madrigal Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Y MAbs position performs unexpectedly, Madrigal Pharmaceuticals 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 Madrigal Pharmaceuticals will offset losses from the drop in Madrigal Pharmaceuticals' long position.| Y MAbs vs. Revolution Medicines | Y MAbs vs. Black Diamond Therapeutics | Y MAbs vs. Passage Bio | Y MAbs vs. Bluebird bio |
| Madrigal Pharmaceuticals vs. TG Therapeutics | Madrigal Pharmaceuticals vs. Terns Pharmaceuticals | Madrigal Pharmaceuticals vs. Hepion Pharmaceuticals | Madrigal Pharmaceuticals vs. Viking 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |