Correlation Between Candel Therapeutics and PepGen
Can any of the company-specific risk be diversified away by investing in both Candel Therapeutics and PepGen 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 Candel Therapeutics and PepGen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Candel Therapeutics and PepGen, you can compare the effects of market volatilities on Candel Therapeutics and PepGen 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 Candel Therapeutics with a short position of PepGen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Candel Therapeutics and PepGen.
Diversification Opportunities for Candel Therapeutics and PepGen
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Candel and PepGen is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Candel Therapeutics and PepGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PepGen and Candel Therapeutics 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 Candel Therapeutics are associated (or correlated) with PepGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PepGen has no effect on the direction of Candel Therapeutics i.e., Candel Therapeutics and PepGen go up and down completely randomly.
Pair Corralation between Candel Therapeutics and PepGen
Given the investment horizon of 90 days Candel Therapeutics is expected to generate 1.03 times more return on investment than PepGen. However, Candel Therapeutics is 1.03 times more volatile than PepGen. It trades about -0.07 of its potential returns per unit of risk. PepGen is currently generating about -0.23 per unit of risk. If you would invest 627.00 in Candel Therapeutics on August 28, 2024 and sell it today you would lose (143.00) from holding Candel Therapeutics or give up 22.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Candel Therapeutics vs. PepGen
Performance |
| Timeline |
| Candel Therapeutics |
| PepGen |
Candel Therapeutics and PepGen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Candel Therapeutics and PepGen
The main advantage of trading using opposite Candel Therapeutics and PepGen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Candel Therapeutics position performs unexpectedly, PepGen 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 PepGen will offset losses from the drop in PepGen's long position.| Candel Therapeutics vs. Aerovate Therapeutics | Candel Therapeutics vs. Adagene | Candel Therapeutics vs. Acrivon Therapeutics, Common | Candel Therapeutics vs. Rezolute |
| PepGen vs. Pmv Pharmaceuticals | PepGen vs. Eliem Therapeutics | PepGen vs. MediciNova | PepGen vs. Pharvaris BV |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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