Correlation Between Anika Therapeutics and Sientra
Can any of the company-specific risk be diversified away by investing in both Anika Therapeutics and Sientra 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 Anika Therapeutics and Sientra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anika Therapeutics and Sientra, you can compare the effects of market volatilities on Anika Therapeutics and Sientra 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 Anika Therapeutics with a short position of Sientra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anika Therapeutics and Sientra.
Diversification Opportunities for Anika Therapeutics and Sientra
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Anika and Sientra is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Anika Therapeutics and Sientra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sientra and Anika 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 Anika Therapeutics are associated (or correlated) with Sientra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sientra has no effect on the direction of Anika Therapeutics i.e., Anika Therapeutics and Sientra go up and down completely randomly.
Pair Corralation between Anika Therapeutics and Sientra
Given the investment horizon of 90 days Anika Therapeutics is expected to under-perform the Sientra. But the stock apears to be less risky and, when comparing its historical volatility, Anika Therapeutics is 3.69 times less risky than Sientra. The stock trades about -0.04 of its potential returns per unit of risk. The Sientra is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 227.00 in Sientra on September 26, 2024 and sell it today you would earn a total of 202.00 from holding Sientra or generate 88.99% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 27.82% |
Values | Daily Returns |
Anika Therapeutics vs. Sientra
Performance |
Timeline |
Anika Therapeutics |
Sientra |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Anika Therapeutics and Sientra Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Anika Therapeutics and Sientra
The main advantage of trading using opposite Anika Therapeutics and Sientra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anika Therapeutics position performs unexpectedly, Sientra 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 Sientra will offset losses from the drop in Sientra's long position.Anika Therapeutics vs. Fate Therapeutics | Anika Therapeutics vs. Caribou Biosciences | Anika Therapeutics vs. Karyopharm Therapeutics | Anika Therapeutics vs. Hookipa 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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