Correlation Between Tonix Pharmaceuticals and Akari Therapeutics

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

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

Diversification Opportunities for Tonix Pharmaceuticals and Akari Therapeutics

0.24

Correlation Coefficient

Tonix Pharmaceuticals  Akari Therapeutics

Modest diversification

The 3 months correlation between Tonix and Akari is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Tonix Pharmaceuticals Holding and Akari Therapeutics PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akari Therapeutics PLC and Tonix Pharmaceuticals 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 Tonix Pharmaceuticals Holding are associated (or correlated) with Akari Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akari Therapeutics PLC has no effect on the direction of Tonix Pharmaceuticals i.e., Tonix Pharmaceuticals and Akari Therapeutics go up and down completely randomly.

Pair Corralation between Tonix Pharmaceuticals and Akari Therapeutics

Given the investment horizon of 90 days Tonix Pharmaceuticals is expected to generate 1.06 times less return on investment than Akari Therapeutics. In addition to that, Tonix Pharmaceuticals is 1.99 times more volatile than Akari Therapeutics PLC. It trades about 0.06 of its total potential returns per unit of risk. Akari Therapeutics PLC is currently generating about 0.12 per unit of volatility. If you would invest  98.00  in Akari Therapeutics PLC on December 25, 2024 and sell it today you would earn a total of  47.00  from holding Akari Therapeutics PLC or generate 47.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Tonix Pharmaceuticals Holding  vs.  Akari Therapeutics PLC

Tonix Pharmaceuticals

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tonix Pharmaceuticals Holding are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Tonix Pharmaceuticals reported solid returns over the last few months and may actually be approaching a breakup point.

Akari Therapeutics PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Akari Therapeutics PLC are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Akari Therapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tonix Pharmaceuticals and Akari Therapeutics

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

The idea behind Tonix Pharmaceuticals Holding and Akari Therapeutics PLC 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .