Correlation Between Editas Medicine and MiMedx
Can any of the company-specific risk be diversified away by investing in both Editas Medicine and MiMedx 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 Editas Medicine and MiMedx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Editas Medicine and MiMedx Group, you can compare the effects of market volatilities on Editas Medicine and MiMedx 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 Editas Medicine with a short position of MiMedx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Editas Medicine and MiMedx.
Diversification Opportunities for Editas Medicine and MiMedx
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Editas and MiMedx is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Editas Medicine and MiMedx Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MiMedx Group and Editas Medicine 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 Editas Medicine are associated (or correlated) with MiMedx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MiMedx Group has no effect on the direction of Editas Medicine i.e., Editas Medicine and MiMedx go up and down completely randomly.
Pair Corralation between Editas Medicine and MiMedx
Given the investment horizon of 90 days Editas Medicine is expected to generate 2.52 times more return on investment than MiMedx. However, Editas Medicine is 2.52 times more volatile than MiMedx Group. It trades about 0.1 of its potential returns per unit of risk. MiMedx Group is currently generating about -0.19 per unit of risk. If you would invest 127.00 in Editas Medicine on November 1, 2024 and sell it today you would earn a total of 10.00 from holding Editas Medicine or generate 7.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Editas Medicine vs. MiMedx Group
Performance |
| Timeline |
| Editas Medicine |
| MiMedx Group |
Editas Medicine and MiMedx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Editas Medicine and MiMedx
The main advantage of trading using opposite Editas Medicine and MiMedx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Editas Medicine position performs unexpectedly, MiMedx 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 MiMedx will offset losses from the drop in MiMedx's long position.| Editas Medicine vs. Beam Therapeutics | Editas Medicine vs. Crispr Therapeutics AG | Editas Medicine vs. Caribou Biosciences | Editas Medicine vs. Verve Therapeutics |
| MiMedx vs. Monte Rosa Therapeutics | MiMedx vs. Design Therapeutics | MiMedx vs. Werewolf Therapeutics | MiMedx vs. Ikena Oncology |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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