Correlation Between Zura Bio and Apollomics
Can any of the company-specific risk be diversified away by investing in both Zura Bio and Apollomics 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 Zura Bio and Apollomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zura Bio Limited and Apollomics Class A, you can compare the effects of market volatilities on Zura Bio and Apollomics 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 Zura Bio with a short position of Apollomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zura Bio and Apollomics.
Diversification Opportunities for Zura Bio and Apollomics
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zura and Apollomics is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Zura Bio Limited and Apollomics Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollomics Class A and Zura Bio 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 Zura Bio Limited are associated (or correlated) with Apollomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollomics Class A has no effect on the direction of Zura Bio i.e., Zura Bio and Apollomics go up and down completely randomly.
Pair Corralation between Zura Bio and Apollomics
Given the investment horizon of 90 days Zura Bio Limited is expected to under-perform the Apollomics. But the stock apears to be less risky and, when comparing its historical volatility, Zura Bio Limited is 1.05 times less risky than Apollomics. The stock trades about -0.25 of its potential returns per unit of risk. The Apollomics Class A is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 1,054 in Apollomics Class A on December 11, 2024 and sell it today you would lose (299.00) from holding Apollomics Class A or give up 28.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zura Bio Limited vs. Apollomics Class A
Performance |
| Timeline |
| Zura Bio Limited |
| Apollomics Class A |
Zura Bio and Apollomics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zura Bio and Apollomics
The main advantage of trading using opposite Zura Bio and Apollomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zura Bio position performs unexpectedly, Apollomics 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 Apollomics will offset losses from the drop in Apollomics' long position.| Zura Bio vs. ServiceNow | ||
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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