Correlation Between Erasca and Codexis
Can any of the company-specific risk be diversified away by investing in both Erasca and Codexis 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 Erasca and Codexis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Erasca Inc and Codexis, you can compare the effects of market volatilities on Erasca and Codexis 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 Erasca with a short position of Codexis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Erasca and Codexis.
Diversification Opportunities for Erasca and Codexis
Very weak diversification
The 3 months correlation between Erasca and Codexis is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Erasca Inc and Codexis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codexis and Erasca 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 Erasca Inc are associated (or correlated) with Codexis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codexis has no effect on the direction of Erasca i.e., Erasca and Codexis go up and down completely randomly.
Pair Corralation between Erasca and Codexis
Given the investment horizon of 90 days Erasca Inc is expected to under-perform the Codexis. But the stock apears to be less risky and, when comparing its historical volatility, Erasca Inc is 1.04 times less risky than Codexis. The stock trades about -0.02 of its potential returns per unit of risk. The Codexis is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 237.00 in Codexis on June 6, 2025 and sell it today you would earn a total of 14.00 from holding Codexis or generate 5.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Erasca Inc vs. Codexis
Performance |
| Timeline |
| Erasca Inc |
| Codexis |
Erasca and Codexis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Erasca and Codexis
The main advantage of trading using opposite Erasca and Codexis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Erasca position performs unexpectedly, Codexis 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 Codexis will offset losses from the drop in Codexis' long position.| Erasca vs. PTC Therapeutics | Erasca vs. Krystal Biotech | Erasca vs. Madrigal Pharmaceuticals | Erasca vs. Biomarin Pharmaceutical |
| Codexis vs. C4 Therapeutics | Codexis vs. CareDx Inc | Codexis vs. Erasca Inc | Codexis vs. Generation Bio Co |
Check out your portfolio center.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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