Correlation Between Mustang Bio and TRACON Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Mustang Bio and TRACON Pharmaceuticals 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 Mustang Bio and TRACON Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mustang Bio and TRACON Pharmaceuticals, you can compare the effects of market volatilities on Mustang Bio and TRACON Pharmaceuticals 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 Mustang Bio with a short position of TRACON Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mustang Bio and TRACON Pharmaceuticals.
Diversification Opportunities for Mustang Bio and TRACON Pharmaceuticals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mustang and TRACON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mustang Bio and TRACON Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRACON Pharmaceuticals and Mustang Bio 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 Mustang Bio are associated (or correlated) with TRACON Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRACON Pharmaceuticals has no effect on the direction of Mustang Bio i.e., Mustang Bio and TRACON Pharmaceuticals go up and down completely randomly.
Pair Corralation between Mustang Bio and TRACON Pharmaceuticals
If you would invest (100.00) in TRACON Pharmaceuticals on November 21, 2024 and sell it today you would earn a total of 100.00 from holding TRACON Pharmaceuticals or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Mustang Bio vs. TRACON Pharmaceuticals
Performance |
Timeline |
Mustang Bio |
TRACON Pharmaceuticals |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Mustang Bio and TRACON Pharmaceuticals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mustang Bio and TRACON Pharmaceuticals
The main advantage of trading using opposite Mustang Bio and TRACON Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mustang Bio position performs unexpectedly, TRACON Pharmaceuticals 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 TRACON Pharmaceuticals will offset losses from the drop in TRACON Pharmaceuticals' long position.Mustang Bio vs. Checkpoint Therapeutics | ||
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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