Correlation Between Antibe Therapeutics and ATyr Pharma

Can any of the company-specific risk be diversified away by investing in both Antibe Therapeutics and ATyr Pharma 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 Antibe Therapeutics and ATyr Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Antibe Therapeutics and ATyr Pharma, you can compare the effects of market volatilities on Antibe Therapeutics and ATyr Pharma 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 Antibe Therapeutics with a short position of ATyr Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antibe Therapeutics and ATyr Pharma.

Diversification Opportunities for Antibe Therapeutics and ATyr Pharma

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Correlation Coefficient

Antibe Therapeutics  ATyr Pharma

Pay attention - limited upside

The 3 months correlation between Antibe and ATyr is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Antibe Therapeutics and ATyr Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATyr Pharma and Antibe 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 Antibe Therapeutics are associated (or correlated) with ATyr Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATyr Pharma has no effect on the direction of Antibe Therapeutics i.e., Antibe Therapeutics and ATyr Pharma go up and down completely randomly.

Pair Corralation between Antibe Therapeutics and ATyr Pharma

Assuming the 90 days horizon Antibe Therapeutics is expected to generate 0.55 times more return on investment than ATyr Pharma. However, Antibe Therapeutics is 1.83 times less risky than ATyr Pharma. It trades about -0.03 of its potential returns per unit of risk. ATyr Pharma is currently generating about -0.07 per unit of risk. If you would invest  71.00  in Antibe Therapeutics on October 2, 2024 and sell it today you would lose (49.00) from holding Antibe Therapeutics or give up 69.01% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	39.04%
Values	Daily Returns

Antibe Therapeutics  vs.  ATyr Pharma

Antibe Therapeutics

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Antibe Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Antibe Therapeutics is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ATyr Pharma

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ATyr Pharma has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, ATyr Pharma is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Antibe Therapeutics and ATyr Pharma

The main advantage of trading using opposite Antibe Therapeutics and ATyr Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Antibe Therapeutics position performs unexpectedly, ATyr Pharma 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 ATyr Pharma will offset losses from the drop in ATyr Pharma's long position.

The idea behind Antibe Therapeutics and ATyr Pharma pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .