Correlation Between FrontView REIT, and Knight Therapeutics

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

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

Diversification Opportunities for FrontView REIT, and Knight Therapeutics

-0.36

Correlation Coefficient

FrontView REIT,  Knight Therapeutics

Very good diversification

The 3 months correlation between FrontView and Knight is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding FrontView REIT, and Knight Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knight Therapeutics and FrontView REIT, 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 FrontView REIT, are associated (or correlated) with Knight Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knight Therapeutics has no effect on the direction of FrontView REIT, i.e., FrontView REIT, and Knight Therapeutics go up and down completely randomly.

Pair Corralation between FrontView REIT, and Knight Therapeutics

Considering the 90-day investment horizon FrontView REIT, is expected to under-perform the Knight Therapeutics. In addition to that, FrontView REIT, is 1.2 times more volatile than Knight Therapeutics. It trades about -0.21 of its total potential returns per unit of risk. Knight Therapeutics is currently generating about 0.16 per unit of volatility. If you would invest  361.00  in Knight Therapeutics on December 22, 2024 and sell it today you would earn a total of  73.00  from holding Knight Therapeutics or generate 20.22% return on investment over 90 days.

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

FrontView REIT,  vs.  Knight Therapeutics

FrontView REIT,

Risk-Adjusted Performance

Very Weak

Over the last 90 days FrontView REIT, has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Knight Therapeutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Knight Therapeutics are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Knight Therapeutics reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FrontView REIT, and Knight Therapeutics

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

The idea behind FrontView REIT, and Knight Therapeutics 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 Stocks Directory module to find actively traded stocks across global markets.