Correlation Between Edesa Biotech and Candel Therapeutics
Can any of the company-specific risk be diversified away by investing in both Edesa Biotech and Candel Therapeutics 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 Edesa Biotech and Candel Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edesa Biotech and Candel Therapeutics, you can compare the effects of market volatilities on Edesa Biotech and Candel Therapeutics 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 Edesa Biotech with a short position of Candel Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edesa Biotech and Candel Therapeutics.
Diversification Opportunities for Edesa Biotech and Candel Therapeutics
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Edesa and Candel is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Edesa Biotech and Candel Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candel Therapeutics and Edesa Biotech 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 Edesa Biotech are associated (or correlated) with Candel Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Candel Therapeutics has no effect on the direction of Edesa Biotech i.e., Edesa Biotech and Candel Therapeutics go up and down completely randomly.
Pair Corralation between Edesa Biotech and Candel Therapeutics
Given the investment horizon of 90 days Edesa Biotech is expected to generate 0.61 times more return on investment than Candel Therapeutics. However, Edesa Biotech is 1.64 times less risky than Candel Therapeutics. It trades about -0.08 of its potential returns per unit of risk. Candel Therapeutics is currently generating about -0.06 per unit of risk. If you would invest 257.00 in Edesa Biotech on September 4, 2024 and sell it today you would lose (20.00) from holding Edesa Biotech or give up 7.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Edesa Biotech vs. Candel Therapeutics
Performance |
| Timeline |
| Edesa Biotech |
| Candel Therapeutics |
Edesa Biotech and Candel Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edesa Biotech and Candel Therapeutics
The main advantage of trading using opposite Edesa Biotech and Candel Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edesa Biotech position performs unexpectedly, Candel Therapeutics 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 Candel Therapeutics will offset losses from the drop in Candel Therapeutics' long position.| Edesa Biotech vs. Candel Therapeutics | Edesa Biotech vs. Cingulate Warrants | Edesa Biotech vs. Unicycive Therapeutics | Edesa Biotech vs. Cardio Diagnostics Holdings |
| Candel Therapeutics vs. Aerovate Therapeutics | Candel Therapeutics vs. Adagene | Candel Therapeutics vs. Acrivon Therapeutics, Common | Candel Therapeutics vs. Rezolute |
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 CEOs Directory module to screen CEOs from public companies around the world.
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