Correlation Between Editas Medicine and Pulmatrix
Can any of the company-specific risk be diversified away by investing in both Editas Medicine and Pulmatrix 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 Pulmatrix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Editas Medicine and Pulmatrix, you can compare the effects of market volatilities on Editas Medicine and Pulmatrix 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 Pulmatrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Editas Medicine and Pulmatrix.
Diversification Opportunities for Editas Medicine and Pulmatrix
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Editas and Pulmatrix is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Editas Medicine and Pulmatrix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pulmatrix 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 Pulmatrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pulmatrix has no effect on the direction of Editas Medicine i.e., Editas Medicine and Pulmatrix go up and down completely randomly.
Pair Corralation between Editas Medicine and Pulmatrix
Given the investment horizon of 90 days Editas Medicine is expected to under-perform the Pulmatrix. But the stock apears to be less risky and, when comparing its historical volatility, Editas Medicine is 1.4 times less risky than Pulmatrix. The stock trades about -0.11 of its potential returns per unit of risk. The Pulmatrix is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 178.00 in Pulmatrix on November 2, 2024 and sell it today you would earn a total of 592.00 from holding Pulmatrix or generate 332.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Editas Medicine vs. Pulmatrix
Performance |
| Timeline |
| Editas Medicine |
| Pulmatrix |
Editas Medicine and Pulmatrix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Editas Medicine and Pulmatrix
The main advantage of trading using opposite Editas Medicine and Pulmatrix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Editas Medicine position performs unexpectedly, Pulmatrix 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 Pulmatrix will offset losses from the drop in Pulmatrix's long position.| Editas Medicine vs. Beam Therapeutics | Editas Medicine vs. Crispr Therapeutics AG | Editas Medicine vs. Caribou Biosciences | Editas Medicine vs. Verve Therapeutics |
| Pulmatrix vs. Capricor Therapeutics | Pulmatrix vs. Akari Therapeutics PLC | Pulmatrix vs. Soleno Therapeutics | Pulmatrix vs. Bio Path Holdings |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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