Correlation Between Eledon Pharmaceuticals and Cue Biopharma
Can any of the company-specific risk be diversified away by investing in both Eledon Pharmaceuticals and Cue Biopharma 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 Eledon Pharmaceuticals and Cue Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eledon Pharmaceuticals and Cue Biopharma, you can compare the effects of market volatilities on Eledon Pharmaceuticals and Cue Biopharma 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 Eledon Pharmaceuticals with a short position of Cue Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eledon Pharmaceuticals and Cue Biopharma.
Diversification Opportunities for Eledon Pharmaceuticals and Cue Biopharma
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eledon and Cue is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Eledon Pharmaceuticals and Cue Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cue Biopharma and Eledon 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 Eledon Pharmaceuticals are associated (or correlated) with Cue Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cue Biopharma has no effect on the direction of Eledon Pharmaceuticals i.e., Eledon Pharmaceuticals and Cue Biopharma go up and down completely randomly.
Pair Corralation between Eledon Pharmaceuticals and Cue Biopharma
Given the investment horizon of 90 days Eledon Pharmaceuticals is expected to generate 0.45 times more return on investment than Cue Biopharma. However, Eledon Pharmaceuticals is 2.23 times less risky than Cue Biopharma. It trades about 0.11 of its potential returns per unit of risk. Cue Biopharma is currently generating about 0.02 per unit of risk. If you would invest 287.00 in Eledon Pharmaceuticals on September 2, 2024 and sell it today you would earn a total of 179.00 from holding Eledon Pharmaceuticals or generate 62.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eledon Pharmaceuticals vs. Cue Biopharma
Performance |
| Timeline |
| Eledon Pharmaceuticals |
| Cue Biopharma |
Eledon Pharmaceuticals and Cue Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eledon Pharmaceuticals and Cue Biopharma
The main advantage of trading using opposite Eledon Pharmaceuticals and Cue Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eledon Pharmaceuticals position performs unexpectedly, Cue Biopharma 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 Cue Biopharma will offset losses from the drop in Cue Biopharma's long position.| Eledon Pharmaceuticals vs. Inozyme Pharma | Eledon Pharmaceuticals vs. Day One Biopharmaceuticals | Eledon Pharmaceuticals vs. Terns Pharmaceuticals | Eledon Pharmaceuticals vs. Hookipa Pharma |
| Cue Biopharma vs. Coya Therapeutics, Common | Cue Biopharma vs. Lantern Pharma | Cue Biopharma vs. Fennec Pharmaceuticals | Cue Biopharma vs. Eliem Therapeutics |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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