Correlation Between Bolt Biotherapeutics and Cingulate
Can any of the company-specific risk be diversified away by investing in both Bolt Biotherapeutics and Cingulate 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 Bolt Biotherapeutics and Cingulate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bolt Biotherapeutics and Cingulate, you can compare the effects of market volatilities on Bolt Biotherapeutics and Cingulate 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 Bolt Biotherapeutics with a short position of Cingulate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bolt Biotherapeutics and Cingulate.
Diversification Opportunities for Bolt Biotherapeutics and Cingulate
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bolt and Cingulate is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bolt Biotherapeutics and Cingulate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cingulate and Bolt Biotherapeutics 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 Bolt Biotherapeutics are associated (or correlated) with Cingulate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cingulate has no effect on the direction of Bolt Biotherapeutics i.e., Bolt Biotherapeutics and Cingulate go up and down completely randomly.
Pair Corralation between Bolt Biotherapeutics and Cingulate
Given the investment horizon of 90 days Bolt Biotherapeutics is expected to under-perform the Cingulate. But the stock apears to be less risky and, when comparing its historical volatility, Bolt Biotherapeutics is 5.84 times less risky than Cingulate. The stock trades about -0.05 of its potential returns per unit of risk. The Cingulate is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 9,180 in Cingulate on August 25, 2024 and sell it today you would lose (8,708) from holding Cingulate or give up 94.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bolt Biotherapeutics vs. Cingulate
Performance |
| Timeline |
| Bolt Biotherapeutics |
| Cingulate |
Bolt Biotherapeutics and Cingulate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bolt Biotherapeutics and Cingulate
The main advantage of trading using opposite Bolt Biotherapeutics and Cingulate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bolt Biotherapeutics position performs unexpectedly, Cingulate 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 Cingulate will offset losses from the drop in Cingulate's long position.| Bolt Biotherapeutics vs. Assembly Biosciences | Bolt Biotherapeutics vs. Instil Bio | Bolt Biotherapeutics vs. CytomX Therapeutics | Bolt Biotherapeutics vs. Achilles Therapeutics PLC |
| Cingulate vs. SAB Biotherapeutics | Cingulate vs. Senti Biosciences | Cingulate vs. Aerovate Therapeutics | Cingulate vs. Adagene |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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