Correlation Between Zura Bio and NextCure
Can any of the company-specific risk be diversified away by investing in both Zura Bio and NextCure 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 NextCure 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 NextCure, you can compare the effects of market volatilities on Zura Bio and NextCure 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 NextCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zura Bio and NextCure.
Diversification Opportunities for Zura Bio and NextCure
Very poor diversification
The 3 months correlation between Zura and NextCure is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Zura Bio Limited and NextCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextCure 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 NextCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextCure has no effect on the direction of Zura Bio i.e., Zura Bio and NextCure go up and down completely randomly.
Pair Corralation between Zura Bio and NextCure
Given the investment horizon of 90 days Zura Bio Limited is expected to under-perform the NextCure. In addition to that, Zura Bio is 1.2 times more volatile than NextCure. It trades about -0.2 of its total potential returns per unit of risk. NextCure is currently generating about 0.0 per unit of volatility. If you would invest 82.00 in NextCure on November 3, 2024 and sell it today you would lose (1.52) from holding NextCure or give up 1.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zura Bio Limited vs. NextCure
Performance |
| Timeline |
| Zura Bio Limited |
| NextCure |
Zura Bio and NextCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zura Bio and NextCure
The main advantage of trading using opposite Zura Bio and NextCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zura Bio position performs unexpectedly, NextCure 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 NextCure will offset losses from the drop in NextCure's long position.| Zura Bio vs. Delek Drilling | Zura Bio vs. Major Drilling Group | Zura Bio vs. Mesa Air Group | Zura Bio vs. Wizz Air Holdings |
| NextCure vs. CytomX Therapeutics | NextCure vs. Spero Therapeutics | NextCure vs. Instil Bio | NextCure vs. Assembly Biosciences |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |