Correlation Between BioCryst Pharmaceuticals and Aeterna Zentaris

Can any of the company-specific risk be diversified away by investing in both BioCryst Pharmaceuticals and Aeterna Zentaris 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 BioCryst Pharmaceuticals and Aeterna Zentaris into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for BioCryst Pharmaceuticals and Aeterna Zentaris

-0.17

Correlation Coefficient

BioCryst Pharmaceuticals  Aeterna Zentaris

Good diversification

The 3 months correlation between BioCryst and Aeterna is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding BioCryst Pharmaceuticals and Aeterna Zentaris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeterna Zentaris and BioCryst Pharmaceuticals 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 BioCryst Pharmaceuticals are associated (or correlated) with Aeterna Zentaris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeterna Zentaris has no effect on the direction of BioCryst Pharmaceuticals i.e., BioCryst Pharmaceuticals and Aeterna Zentaris go up and down completely randomly.

Pair Corralation between BioCryst Pharmaceuticals and Aeterna Zentaris

If you would invest  614.00  in Aeterna Zentaris on September 17, 2024 and sell it today you would earn a total of  0.00  from holding Aeterna Zentaris or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.54%
Values	Daily Returns

BioCryst Pharmaceuticals  vs.  Aeterna Zentaris

BioCryst Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BioCryst Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, BioCryst Pharmaceuticals is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Aeterna Zentaris

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aeterna Zentaris has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Aeterna Zentaris is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with BioCryst Pharmaceuticals and Aeterna Zentaris

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

The idea behind BioCryst Pharmaceuticals and Aeterna Zentaris 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.

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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.