Correlation Between Assembly Biosciences and Oncternal Therapeutics

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

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

Diversification Opportunities for Assembly Biosciences and Oncternal Therapeutics

-0.4

Correlation Coefficient

Assembly Biosciences  Oncternal Therapeutics

Very good diversification

The 3 months correlation between Assembly and Oncternal is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Assembly Biosciences and Oncternal Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oncternal Therapeutics and Assembly Biosciences 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 Assembly Biosciences are associated (or correlated) with Oncternal Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oncternal Therapeutics has no effect on the direction of Assembly Biosciences i.e., Assembly Biosciences and Oncternal Therapeutics go up and down completely randomly.

Pair Corralation between Assembly Biosciences and Oncternal Therapeutics

Given the investment horizon of 90 days Assembly Biosciences is expected to generate 0.36 times more return on investment than Oncternal Therapeutics. However, Assembly Biosciences is 2.79 times less risky than Oncternal Therapeutics. It trades about 0.08 of its potential returns per unit of risk. Oncternal Therapeutics is currently generating about -0.08 per unit of risk. If you would invest  1,405  in Assembly Biosciences on August 15, 2024 and sell it today you would earn a total of  252.00  from holding Assembly Biosciences or generate 17.94% return on investment over 90 days.

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

Assembly Biosciences  vs.  Oncternal Therapeutics

Assembly Biosciences

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Assembly Biosciences are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating primary indicators, Assembly Biosciences sustained solid returns over the last few months and may actually be approaching a breakup point.

Oncternal Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oncternal Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Assembly Biosciences and Oncternal Therapeutics

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

The idea behind Assembly Biosciences and Oncternal 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.