Correlation Between Centessa Pharmaceuticals and ICU Medical
Can any of the company-specific risk be diversified away by investing in both Centessa Pharmaceuticals and ICU Medical 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 Centessa Pharmaceuticals and ICU Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centessa Pharmaceuticals PLC and ICU Medical, you can compare the effects of market volatilities on Centessa Pharmaceuticals and ICU Medical 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 Centessa Pharmaceuticals with a short position of ICU Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centessa Pharmaceuticals and ICU Medical.
Diversification Opportunities for Centessa Pharmaceuticals and ICU Medical
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Centessa and ICU is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Centessa Pharmaceuticals PLC and ICU Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICU Medical and Centessa Pharmaceuticals 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 Centessa Pharmaceuticals PLC are associated (or correlated) with ICU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICU Medical has no effect on the direction of Centessa Pharmaceuticals i.e., Centessa Pharmaceuticals and ICU Medical go up and down completely randomly.
Pair Corralation between Centessa Pharmaceuticals and ICU Medical
Given the investment horizon of 90 days Centessa Pharmaceuticals PLC is expected to generate 1.31 times more return on investment than ICU Medical. However, Centessa Pharmaceuticals is 1.31 times more volatile than ICU Medical. It trades about 0.17 of its potential returns per unit of risk. ICU Medical is currently generating about 0.12 per unit of risk. If you would invest 850.00 in Centessa Pharmaceuticals PLC on September 1, 2024 and sell it today you would earn a total of 941.00 from holding Centessa Pharmaceuticals PLC or generate 110.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centessa Pharmaceuticals PLC vs. ICU Medical
Performance |
| Timeline |
| Centessa Pharmaceuticals |
| ICU Medical |
Centessa Pharmaceuticals and ICU Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centessa Pharmaceuticals and ICU Medical
The main advantage of trading using opposite Centessa Pharmaceuticals and ICU Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centessa Pharmaceuticals position performs unexpectedly, ICU Medical 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 ICU Medical will offset losses from the drop in ICU Medical's long position.| Centessa Pharmaceuticals vs. Tff Pharmaceuticals | Centessa Pharmaceuticals vs. Eliem Therapeutics | Centessa Pharmaceuticals vs. Inhibrx | Centessa Pharmaceuticals vs. Enliven Therapeutics |
| ICU Medical vs. Merit Medical Systems | ICU Medical vs. The Cooper Companies, | ICU Medical vs. AngioDynamics | ICU Medical vs. AptarGroup |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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