Correlation Between Exscientia and Gossamer Bio
Can any of the company-specific risk be diversified away by investing in both Exscientia and Gossamer Bio 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 Exscientia and Gossamer Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exscientia Ltd ADR and Gossamer Bio, you can compare the effects of market volatilities on Exscientia and Gossamer Bio 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 Exscientia with a short position of Gossamer Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exscientia and Gossamer Bio.
Diversification Opportunities for Exscientia and Gossamer Bio
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Exscientia and Gossamer is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Exscientia Ltd ADR and Gossamer Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gossamer Bio and Exscientia 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 Exscientia Ltd ADR are associated (or correlated) with Gossamer Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gossamer Bio has no effect on the direction of Exscientia i.e., Exscientia and Gossamer Bio go up and down completely randomly.
Pair Corralation between Exscientia and Gossamer Bio
Given the investment horizon of 90 days Exscientia Ltd ADR is expected to under-perform the Gossamer Bio. But the stock apears to be less risky and, when comparing its historical volatility, Exscientia Ltd ADR is 1.24 times less risky than Gossamer Bio. The stock trades about -0.04 of its potential returns per unit of risk. The Gossamer Bio is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 95.00 in Gossamer Bio on September 26, 2024 and sell it today you would lose (11.00) from holding Gossamer Bio or give up 11.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 65.08% |
| Values | Daily Returns |
Exscientia Ltd ADR vs. Gossamer Bio
Performance |
| Timeline |
| Exscientia ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Gossamer Bio |
Exscientia and Gossamer Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exscientia and Gossamer Bio
The main advantage of trading using opposite Exscientia and Gossamer Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exscientia position performs unexpectedly, Gossamer Bio 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 Gossamer Bio will offset losses from the drop in Gossamer Bio's long position.| Exscientia vs. Zura Bio Limited | Exscientia vs. Elevation Oncology | Exscientia vs. Recursion Pharmaceuticals | Exscientia vs. Atea Pharmaceuticals |
| Gossamer Bio vs. Fate Therapeutics | Gossamer Bio vs. Caribou Biosciences | Gossamer Bio vs. Karyopharm Therapeutics | Gossamer Bio vs. Hookipa Pharma |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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