Correlation Between Rubis SCA and Abeona Therapeutics

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

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

Diversification Opportunities for Rubis SCA and Abeona Therapeutics

0.67

Correlation Coefficient

Rubis SCA  Abeona Therapeutics

Poor diversification

The 3 months correlation between Rubis and Abeona is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Rubis SCA ADR and Abeona Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abeona Therapeutics and Rubis SCA 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 Rubis SCA ADR are associated (or correlated) with Abeona Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abeona Therapeutics has no effect on the direction of Rubis SCA i.e., Rubis SCA and Abeona Therapeutics go up and down completely randomly.

Pair Corralation between Rubis SCA and Abeona Therapeutics

Assuming the 90 days horizon Rubis SCA is expected to generate 1.37 times less return on investment than Abeona Therapeutics. In addition to that, Rubis SCA is 1.13 times more volatile than Abeona Therapeutics. It trades about 0.11 of its total potential returns per unit of risk. Abeona Therapeutics is currently generating about 0.18 per unit of volatility. If you would invest  699.00  in Abeona Therapeutics on January 18, 2024 and sell it today you would earn a total of  94.00  from holding Abeona Therapeutics or generate 13.45% return on investment over 90 days.

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

Rubis SCA ADR  vs.  Abeona Therapeutics

Rubis SCA ADR

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rubis SCA ADR are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Rubis SCA showed solid returns over the last few months and may actually be approaching a breakup point.

Abeona Therapeutics

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Abeona Therapeutics are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent technical and fundamental indicators, Abeona Therapeutics displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rubis SCA and Abeona Therapeutics

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

The idea behind Rubis SCA ADR and Abeona 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.