Correlation Between Caribou Biosciences and Agilent Technologies
Can any of the company-specific risk be diversified away by investing in both Caribou Biosciences and Agilent Technologies 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 Caribou Biosciences and Agilent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caribou Biosciences and Agilent Technologies, you can compare the effects of market volatilities on Caribou Biosciences and Agilent Technologies 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 Caribou Biosciences with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caribou Biosciences and Agilent Technologies.
Diversification Opportunities for Caribou Biosciences and Agilent Technologies
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Caribou and Agilent is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Caribou Biosciences and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and Caribou Biosciences 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 Caribou Biosciences are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Caribou Biosciences i.e., Caribou Biosciences and Agilent Technologies go up and down completely randomly.
Pair Corralation between Caribou Biosciences and Agilent Technologies
Given the investment horizon of 90 days Caribou Biosciences is expected to under-perform the Agilent Technologies. In addition to that, Caribou Biosciences is 3.37 times more volatile than Agilent Technologies. It trades about -0.02 of its total potential returns per unit of risk. Agilent Technologies is currently generating about -0.01 per unit of volatility. If you would invest 15,550 in Agilent Technologies on September 3, 2024 and sell it today you would lose (1,753) from holding Agilent Technologies or give up 11.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caribou Biosciences vs. Agilent Technologies
Performance |
| Timeline |
| Caribou Biosciences |
| Agilent Technologies |
Caribou Biosciences and Agilent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caribou Biosciences and Agilent Technologies
The main advantage of trading using opposite Caribou Biosciences and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caribou Biosciences position performs unexpectedly, Agilent Technologies 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.| Caribou Biosciences vs. Intellia Therapeutics | Caribou Biosciences vs. Editas Medicine | Caribou Biosciences vs. Crispr Therapeutics AG | Caribou Biosciences vs. Verve Therapeutics |
| Agilent Technologies vs. Danaher | Agilent Technologies vs. Guardant Health | Agilent Technologies vs. Charles River Laboratories |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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