Correlation Between Monte Rosa and Ampio Pharm

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

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

Diversification Opportunities for Monte Rosa and Ampio Pharm

0.0

Correlation Coefficient

Monte Rosa  Ampio Pharm

Pay attention - limited upside

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

Pair Corralation between Monte Rosa and Ampio Pharm

If you would invest  703.00  in Monte Rosa Therapeutics on December 18, 2024 and sell it today you would lose (30.00) from holding Monte Rosa Therapeutics or give up 4.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Monte Rosa Therapeutics  vs.  Ampio Pharm

Monte Rosa Therapeutics

Risk-Adjusted Performance

Very Weak

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

Ampio Pharm

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Monte Rosa and Ampio Pharm

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

The idea behind Monte Rosa Therapeutics and Ampio Pharm 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.