Correlation Between Kineta and Rasna Therapeutics

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

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

Diversification Opportunities for Kineta and Rasna Therapeutics

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Correlation Coefficient

Kineta  Rasna Therapeutics

Pay attention - limited upside

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

Pair Corralation between Kineta and Rasna Therapeutics

Allowing for the 90-day total investment horizon Kineta Inc is expected to under-perform the Rasna Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Kineta Inc is 6.31 times less risky than Rasna Therapeutics. The stock trades about -0.02 of its potential returns per unit of risk. The Rasna Therapeutics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  2.50  in Rasna Therapeutics on September 24, 2024 and sell it today you would lose (2.10) from holding Rasna Therapeutics or give up 84.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.58%
Values	Daily Returns

Kineta Inc  vs.  Rasna Therapeutics

Kineta Inc

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Kineta Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Rasna Therapeutics

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Rasna Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Rasna Therapeutics is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Kineta and Rasna Therapeutics

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

The idea behind Kineta Inc and Rasna 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.