Correlation Between Freeline Therapeutics and VectivBio Holding
Can any of the company-specific risk be diversified away by investing in both Freeline Therapeutics and VectivBio Holding 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 Freeline Therapeutics and VectivBio Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freeline Therapeutics Holdings and VectivBio Holding AG, you can compare the effects of market volatilities on Freeline Therapeutics and VectivBio Holding 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 Freeline Therapeutics with a short position of VectivBio Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freeline Therapeutics and VectivBio Holding.
Diversification Opportunities for Freeline Therapeutics and VectivBio Holding
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Freeline and VectivBio is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Freeline Therapeutics Holdings and VectivBio Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VectivBio Holding and Freeline Therapeutics 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 Freeline Therapeutics Holdings are associated (or correlated) with VectivBio Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VectivBio Holding has no effect on the direction of Freeline Therapeutics i.e., Freeline Therapeutics and VectivBio Holding go up and down completely randomly.
Pair Corralation between Freeline Therapeutics and VectivBio Holding
Given the investment horizon of 90 days Freeline Therapeutics Holdings is expected to under-perform the VectivBio Holding. In addition to that, Freeline Therapeutics is 1.98 times more volatile than VectivBio Holding AG. It trades about -0.02 of its total potential returns per unit of risk. VectivBio Holding AG is currently generating about 0.14 per unit of volatility. If you would invest 795.00 in VectivBio Holding AG on August 28, 2024 and sell it today you would earn a total of 890.00 from holding VectivBio Holding AG or generate 111.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.27% |
| Values | Daily Returns |
Freeline Therapeutics Holdings vs. VectivBio Holding AG
Performance |
| Timeline |
| Freeline Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| VectivBio Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Freeline Therapeutics and VectivBio Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freeline Therapeutics and VectivBio Holding
The main advantage of trading using opposite Freeline Therapeutics and VectivBio Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freeline Therapeutics position performs unexpectedly, VectivBio Holding 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 VectivBio Holding will offset losses from the drop in VectivBio Holding's long position.| Freeline Therapeutics vs. Cns Pharmaceuticals | Freeline Therapeutics vs. ZyVersa Therapeutics | Freeline Therapeutics vs. Immix Biopharma | Freeline Therapeutics vs. Hepion Pharmaceuticals |
| VectivBio Holding vs. Cns Pharmaceuticals | VectivBio Holding vs. ZyVersa Therapeutics | VectivBio Holding vs. Immix Biopharma | VectivBio Holding vs. Hepion Pharmaceuticals |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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