Correlation Between Abcellera Biologics and Catalyst Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Abcellera Biologics and Catalyst Pharmaceuticals 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 Abcellera Biologics and Catalyst Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abcellera Biologics and Catalyst Pharmaceuticals, you can compare the effects of market volatilities on Abcellera Biologics and Catalyst Pharmaceuticals 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 Abcellera Biologics with a short position of Catalyst Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abcellera Biologics and Catalyst Pharmaceuticals.
Diversification Opportunities for Abcellera Biologics and Catalyst Pharmaceuticals
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Abcellera and Catalyst is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Abcellera Biologics and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals and Abcellera Biologics 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 Abcellera Biologics are associated (or correlated) with Catalyst Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Pharmaceuticals has no effect on the direction of Abcellera Biologics i.e., Abcellera Biologics and Catalyst Pharmaceuticals go up and down completely randomly.
Pair Corralation between Abcellera Biologics and Catalyst Pharmaceuticals
Given the investment horizon of 90 days Abcellera Biologics is expected to generate 2.19 times more return on investment than Catalyst Pharmaceuticals. However, Abcellera Biologics is 2.19 times more volatile than Catalyst Pharmaceuticals. It trades about 0.0 of its potential returns per unit of risk. Catalyst Pharmaceuticals is currently generating about -0.01 per unit of risk. If you would invest 278.00 in Abcellera Biologics on August 24, 2024 and sell it today you would lose (6.00) from holding Abcellera Biologics or give up 2.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Abcellera Biologics vs. Catalyst Pharmaceuticals
Performance |
| Timeline |
| Abcellera Biologics |
| Catalyst Pharmaceuticals |
Abcellera Biologics and Catalyst Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abcellera Biologics and Catalyst Pharmaceuticals
The main advantage of trading using opposite Abcellera Biologics and Catalyst Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abcellera Biologics position performs unexpectedly, Catalyst Pharmaceuticals 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 Catalyst Pharmaceuticals will offset losses from the drop in Catalyst Pharmaceuticals' long position.| Abcellera Biologics vs. Hepion Pharmaceuticals | Abcellera Biologics vs. Krystal Biotech | Abcellera Biologics vs. CureVac NV | Abcellera Biologics vs. Vir Biotechnology |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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