Correlation Between Alpha Tau and Exicure

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

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

Diversification Opportunities for Alpha Tau and Exicure

-0.09

Correlation Coefficient

Alpha Tau  Exicure

Good diversification

The 3 months correlation between Alpha and Exicure is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Tau Medical and Exicure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exicure and Alpha Tau 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 Alpha Tau Medical are associated (or correlated) with Exicure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exicure has no effect on the direction of Alpha Tau i.e., Alpha Tau and Exicure go up and down completely randomly.

Pair Corralation between Alpha Tau and Exicure

Given the investment horizon of 90 days Alpha Tau Medical is expected to under-perform the Exicure. But the stock apears to be less risky and, when comparing its historical volatility, Alpha Tau Medical is 2.9 times less risky than Exicure. The stock trades about -0.05 of its potential returns per unit of risk. The Exicure is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,867  in Exicure on December 20, 2024 and sell it today you would lose (511.00) from holding Exicure or give up 27.37% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Alpha Tau Medical  vs.  Exicure

Alpha Tau Medical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alpha Tau Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Exicure

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Exicure are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Exicure may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Alpha Tau and Exicure

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

The idea behind Alpha Tau Medical and Exicure 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.