Correlation Between Kamada and Windtree Therapeutics

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

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

Diversification Opportunities for Kamada and Windtree Therapeutics

-0.25

Correlation Coefficient

Kamada  Windtree Therapeutics

Very good diversification

The 3 months correlation between Kamada and Windtree is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Kamada and Windtree Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Windtree Therapeutics and Kamada 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 Kamada are associated (or correlated) with Windtree Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Windtree Therapeutics has no effect on the direction of Kamada i.e., Kamada and Windtree Therapeutics go up and down completely randomly.

Pair Corralation between Kamada and Windtree Therapeutics

Given the investment horizon of 90 days Kamada is expected to generate 0.18 times more return on investment than Windtree Therapeutics. However, Kamada is 5.52 times less risky than Windtree Therapeutics. It trades about 0.06 of its potential returns per unit of risk. Windtree Therapeutics is currently generating about 0.0 per unit of risk. If you would invest  671.00  in Kamada on May 3, 2025 and sell it today you would earn a total of  51.00  from holding Kamada or generate 7.6% return on investment over 90 days.

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

Kamada  vs.  Windtree Therapeutics

Kamada

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kamada are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating fundamental indicators, Kamada may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Windtree Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Windtree Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Windtree Therapeutics is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Kamada and Windtree Therapeutics

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

The idea behind Kamada and Windtree 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.