Correlation Between Viking Therapeutics and EXACT Sciences

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

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

Diversification Opportunities for Viking Therapeutics and EXACT Sciences

0.41

Correlation Coefficient

Viking Therapeutics  EXACT Sciences

Very weak diversification

The 3 months correlation between Viking and EXACT is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Viking Therapeutics and EXACT Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXACT Sciences and Viking Therapeutics 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 Viking Therapeutics are associated (or correlated) with EXACT Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXACT Sciences has no effect on the direction of Viking Therapeutics i.e., Viking Therapeutics and EXACT Sciences go up and down completely randomly.

Pair Corralation between Viking Therapeutics and EXACT Sciences

Given the investment horizon of 90 days Viking Therapeutics is expected to generate 1.76 times less return on investment than EXACT Sciences. In addition to that, Viking Therapeutics is 1.5 times more volatile than EXACT Sciences. It trades about 0.04 of its total potential returns per unit of risk. EXACT Sciences is currently generating about 0.1 per unit of volatility. If you would invest  4,755  in EXACT Sciences on March 2, 2025 and sell it today you would earn a total of  873.00  from holding EXACT Sciences or generate 18.36% return on investment over 90 days.

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

Viking Therapeutics  vs.  EXACT Sciences

Viking Therapeutics

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Viking Therapeutics are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Viking Therapeutics may actually be approaching a critical reversion point that can send shares even higher in July 2025.

EXACT Sciences

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EXACT Sciences are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, EXACT Sciences unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Viking Therapeutics and EXACT Sciences

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

The idea behind Viking Therapeutics and EXACT Sciences 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..