Correlation Between Cingulate Warrants and NextCure
Can any of the company-specific risk be diversified away by investing in both Cingulate Warrants and NextCure 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 Cingulate Warrants and NextCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cingulate Warrants and NextCure, you can compare the effects of market volatilities on Cingulate Warrants and NextCure 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 Cingulate Warrants with a short position of NextCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cingulate Warrants and NextCure.
Diversification Opportunities for Cingulate Warrants and NextCure
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cingulate and NextCure is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Cingulate Warrants and NextCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextCure and Cingulate Warrants 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 Cingulate Warrants are associated (or correlated) with NextCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextCure has no effect on the direction of Cingulate Warrants i.e., Cingulate Warrants and NextCure go up and down completely randomly.
Pair Corralation between Cingulate Warrants and NextCure
Assuming the 90 days horizon Cingulate Warrants is expected to generate 4.23 times more return on investment than NextCure. However, Cingulate Warrants is 4.23 times more volatile than NextCure. It trades about 0.0 of its potential returns per unit of risk. NextCure is currently generating about -0.07 per unit of risk. If you would invest 6.75 in Cingulate Warrants on September 12, 2024 and sell it today you would lose (3.38) from holding Cingulate Warrants or give up 50.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Cingulate Warrants vs. NextCure
Performance |
| Timeline |
| Cingulate Warrants |
| NextCure |
Cingulate Warrants and NextCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cingulate Warrants and NextCure
The main advantage of trading using opposite Cingulate Warrants and NextCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cingulate Warrants position performs unexpectedly, NextCure 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 NextCure will offset losses from the drop in NextCure's long position.| Cingulate Warrants vs. Puma Biotechnology | Cingulate Warrants vs. Iovance Biotherapeutics | Cingulate Warrants vs. Sarepta Therapeutics | Cingulate Warrants vs. Day One Biopharmaceuticals |
| NextCure vs. CytomX Therapeutics | NextCure vs. Spero Therapeutics | NextCure vs. Instil Bio | NextCure vs. Assembly Biosciences |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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