Correlation Between BridgeBio Pharma and Cytodyn
Can any of the company-specific risk be diversified away by investing in both BridgeBio Pharma and Cytodyn 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 BridgeBio Pharma and Cytodyn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BridgeBio Pharma and Cytodyn, you can compare the effects of market volatilities on BridgeBio Pharma and Cytodyn 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 BridgeBio Pharma with a short position of Cytodyn. Check out your portfolio center. Please also check ongoing floating volatility patterns of BridgeBio Pharma and Cytodyn.
Diversification Opportunities for BridgeBio Pharma and Cytodyn
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BridgeBio and Cytodyn is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding BridgeBio Pharma and Cytodyn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytodyn and BridgeBio Pharma 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 BridgeBio Pharma are associated (or correlated) with Cytodyn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytodyn has no effect on the direction of BridgeBio Pharma i.e., BridgeBio Pharma and Cytodyn go up and down completely randomly.
Pair Corralation between BridgeBio Pharma and Cytodyn
Given the investment horizon of 90 days BridgeBio Pharma is expected to generate 0.48 times more return on investment than Cytodyn. However, BridgeBio Pharma is 2.1 times less risky than Cytodyn. It trades about -0.01 of its potential returns per unit of risk. Cytodyn is currently generating about -0.01 per unit of risk. If you would invest 3,252 in BridgeBio Pharma on September 3, 2024 and sell it today you would lose (592.00) from holding BridgeBio Pharma or give up 18.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BridgeBio Pharma vs. Cytodyn
Performance |
| Timeline |
| BridgeBio Pharma |
| Cytodyn |
BridgeBio Pharma and Cytodyn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BridgeBio Pharma and Cytodyn
The main advantage of trading using opposite BridgeBio Pharma and Cytodyn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BridgeBio Pharma position performs unexpectedly, Cytodyn 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 Cytodyn will offset losses from the drop in Cytodyn's long position.| BridgeBio Pharma vs. Blueprint Medicines Corp | BridgeBio Pharma vs. Amylyx Pharmaceuticals | BridgeBio Pharma vs. Day One Biopharmaceuticals | BridgeBio Pharma vs. Terns Pharmaceuticals |
| Cytodyn vs. Madrigal Pharmaceuticals | Cytodyn vs. Scpharmaceuticals | Cytodyn vs. Akero Therapeutics | Cytodyn vs. Cardiff Oncology |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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