Correlation Between Ventyx Biosciences and MoonLake Immunotherapeuti

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Can any of the company-specific risk be diversified away by investing in both Ventyx Biosciences and MoonLake Immunotherapeuti 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 Ventyx Biosciences and MoonLake Immunotherapeuti into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ventyx Biosciences and MoonLake Immunotherapeutics, you can compare the effects of market volatilities on Ventyx Biosciences and MoonLake Immunotherapeuti 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 Ventyx Biosciences with a short position of MoonLake Immunotherapeuti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ventyx Biosciences and MoonLake Immunotherapeuti.

Diversification Opportunities for Ventyx Biosciences and MoonLake Immunotherapeuti

-0.63
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Ventyx and MoonLake is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Ventyx Biosciences and MoonLake Immunotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MoonLake Immunotherapeuti and Ventyx 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 Ventyx Biosciences are associated (or correlated) with MoonLake Immunotherapeuti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MoonLake Immunotherapeuti has no effect on the direction of Ventyx Biosciences i.e., Ventyx Biosciences and MoonLake Immunotherapeuti go up and down completely randomly.

Pair Corralation between Ventyx Biosciences and MoonLake Immunotherapeuti

Given the investment horizon of 90 days Ventyx Biosciences is expected to generate 0.85 times more return on investment than MoonLake Immunotherapeuti. However, Ventyx Biosciences is 1.17 times less risky than MoonLake Immunotherapeuti. It trades about 0.26 of its potential returns per unit of risk. MoonLake Immunotherapeutics is currently generating about 0.01 per unit of risk. If you would invest  240.00  in Ventyx Biosciences on August 29, 2025 and sell it today you would earn a total of  759.00  from holding Ventyx Biosciences or generate 316.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Ventyx Biosciences  vs.  MoonLake Immunotherapeutics

 Performance 
       Timeline  
Ventyx Biosciences 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Ventyx Biosciences are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Ventyx Biosciences showed solid returns over the last few months and may actually be approaching a breakup point.
MoonLake Immunotherapeuti 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days MoonLake Immunotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, MoonLake Immunotherapeuti is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Ventyx Biosciences and MoonLake Immunotherapeuti Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ventyx Biosciences and MoonLake Immunotherapeuti

The main advantage of trading using opposite Ventyx Biosciences and MoonLake Immunotherapeuti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ventyx Biosciences position performs unexpectedly, MoonLake Immunotherapeuti 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 MoonLake Immunotherapeuti will offset losses from the drop in MoonLake Immunotherapeuti's long position.
The idea behind Ventyx Biosciences and MoonLake Immunotherapeutics 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..

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