Correlation Between Candel Therapeutics and Virax Biolabs
Can any of the company-specific risk be diversified away by investing in both Candel Therapeutics and Virax Biolabs 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 Virax Biolabs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Candel Therapeutics and Virax Biolabs Group, you can compare the effects of market volatilities on Candel Therapeutics and Virax Biolabs 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 Virax Biolabs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Candel Therapeutics and Virax Biolabs.
Diversification Opportunities for Candel Therapeutics and Virax Biolabs
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Candel and Virax is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Candel Therapeutics and Virax Biolabs Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virax Biolabs Group 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 Virax Biolabs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virax Biolabs Group has no effect on the direction of Candel Therapeutics i.e., Candel Therapeutics and Virax Biolabs go up and down completely randomly.
Pair Corralation between Candel Therapeutics and Virax Biolabs
Given the investment horizon of 90 days Candel Therapeutics is expected to under-perform the Virax Biolabs. But the stock apears to be less risky and, when comparing its historical volatility, Candel Therapeutics is 1.02 times less risky than Virax Biolabs. The stock trades about -0.05 of its potential returns per unit of risk. The Virax Biolabs Group is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 207.00 in Virax Biolabs Group on September 1, 2024 and sell it today you would lose (10.00) from holding Virax Biolabs Group or give up 4.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Candel Therapeutics vs. Virax Biolabs Group
Performance |
| Timeline |
| Candel Therapeutics |
| Virax Biolabs Group |
Candel Therapeutics and Virax Biolabs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Candel Therapeutics and Virax Biolabs
The main advantage of trading using opposite Candel Therapeutics and Virax Biolabs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Candel Therapeutics position performs unexpectedly, Virax Biolabs 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 Virax Biolabs will offset losses from the drop in Virax Biolabs' long position.| Candel Therapeutics vs. Aerovate Therapeutics | Candel Therapeutics vs. Adagene | Candel Therapeutics vs. Acrivon Therapeutics, Common | Candel Therapeutics vs. Rezolute |
| Virax Biolabs vs. Tff Pharmaceuticals | Virax Biolabs vs. Eliem Therapeutics | Virax Biolabs vs. Inhibrx | Virax Biolabs vs. Enliven Therapeutics |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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