Beta Factor in Focus – Nektar Therapeutics, (NASDAQ: NKTR)

Nektar Therapeutics, (NASDAQ: NKTR) was trading 10.58% away from its yearly high level, during the last trading session. The last session’s volume was 6,717,607 compared to its average daily volume of 1.17M shares. The company has its outstanding shares of 154.88M. The Healthcare stock showed a change of 4.52% from opening and finally closed at $30.30 by scoring 12.89%.

Stock’s Technical Analysis:

Technical Analysis is the forecasting of future financial price movements based on an examination of past price movements. Technical indicators, collectively called “technicals”, are distinguished by the fact that they do not analyze any part of the fundamental business, like earnings, revenue and profit margins. Technical indicators are used immensely by active traders in the market, as they are intended mainly for analyzing short-term price movements. To a long-term shareholder, most technical indicators are of little value, as they do nothing to shed light on the underlying business. The most effective uses of technicals for a long-term shareholder are to assist identify good entry and exit points for the stock by analyzing the long-term trend.

This stock is ahead of its 52-week low with 165.56%. The share price has moved away from its 20 days moving average at the rate of 26.62% and its 50 days moving average returned 31.23%. The stock returned 30.21% last month which was maintained at 146.94% this year. However, weekly performance stands at 29.65%.

Insider and Institutional Ownership:

98.40% of Nektar Therapeutics shares are owned by institutional investors. 0.90% of Nektar Therapeutics shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Where the Level Of Risk Stands For This Stock? (Beta & Volatility Analysis):

Risk management is a fundamental process used to make investment decisions. The process involves spotting the amount of risk involved and either accepting or mitigating the risk linked with an investment. Some common measures of risk are standard deviation, beta, value at risk (VaR) and conditional value at risk.

Standard deviation gauges the dispersion of data from its projected value. The standard deviation is used in making an investment decision to measure the amount of historical volatility, or risk, linked with an investment relative to its annual rate of return. It represents how much the current return is deviating from its predictable historical normal returns. For example, a stock that has a high standard deviation experiences higher volatility, and therefore, a higher level of risk is associated with the stock. After a recent check, Nektar Therapeutics, (NASDAQ: NKTR)’s last month price volatility comes out to be 4.31% which for the week stands at 6.87%. Volatility is one of those things which for many retail shareholders means very little, but it’s the basis on which stocks and are traded and the sentiment in markets is also assessed. High volatility can make entering or an exit a stock expensive, it can also exacerbate price increases and potential profits to the upside and downside.

Another common measure of risk is Beta. Beta measures the amount of systematic risk a security has relative to the whole market. The market has a beta of 1, and it can be used to gauge the risk of a security. The beta value of NKTR stands at 1.33. If a security’s beta is equal to 1, the security’s price moves in time step with the market. A security with a beta greater than 1 indicates that it is more volatile than the market. Conversely, if a security’s beta is less than 1, it indicates that the security is less volatile than the market. For example, suppose a security’s beta is 1.5. In theory, the security is 50% more volatile than the market.

In-Depth Volatility Analysis:

Developed by J. Welles Wilder, the Average True Range (ATR) is an indicator that gauges volatility. As with most of his indicators, Wilder designed ATR with commodities and daily prices in mind. Commodities are normally more volatile than stocks. They were are often subject to gaps and limit moves, which occur when a commodity opens up or down its maximum allowed move for the session. A volatility formula based only on the high-low range would fail to capture volatility from gap or limit moves. Wilder created Average True Range to capture this “missing” volatility. It is important to remember that ATR does not provide an indication of price direction, just volatility.

ATR is counted for different periods, like 9-day, 14-day, 20-day, 50-day and 100-day. At the moment, the 14-days ATR for Nektar Therapeutics (NASDAQ: NKTR) is noted at 1.30.

Disclaimer: Any news, report, research, and analysis published on are only for information purposes. Stocks News Times (SNT) makes sure to keep the information up to date and correct, but we didn’t suggest or recommend buying or selling of any financial instrument unless that information is subsequently confirmed on your own. Information in this release is fact checked and produced by competent editors of Stocks News Times; however, human error can exist.

Joseph Nava

Joseph Nava is Senior News Writer for Stocks News Times. Joseph covers “Healthcare” sector and writes about trending healthcare companies from an exclusive and “out of the box” perspective. Over the years he has built a network of resources within the healthcare sector he writes about. He started investing in 2003 as a hobby, and since it has grown to be his passion. He looks for investments that generate strong value in the long run, and also assist shareholders avoid pitfalls through his analysis.

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