Correlation Between Capricor Therapeutics and Awakn Life

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

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

Diversification Opportunities for Capricor Therapeutics and Awakn Life

0.0

Correlation Coefficient

Capricor Therapeutics  Awakn Life

Pay attention - limited upside

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

Pair Corralation between Capricor Therapeutics and Awakn Life

If you would invest  6.50  in Awakn Life Sciences on December 29, 2024 and sell it today you would earn a total of  0.00  from holding Awakn Life Sciences or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Capricor Therapeutics  vs.  Awakn Life Sciences

Capricor Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Capricor Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Awakn Life Sciences

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Capricor Therapeutics and Awakn Life

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

The idea behind Capricor Therapeutics and Awakn Life Sciences 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 Global Correlations module to find global opportunities by holding instruments from different markets.