Correlation Between Generation Bio and Assembly Biosciences
Can any of the company-specific risk be diversified away by investing in both Generation Bio and Assembly Biosciences 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 Generation Bio and Assembly Biosciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Generation Bio Co and Assembly Biosciences, you can compare the effects of market volatilities on Generation Bio and Assembly Biosciences 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 Generation Bio with a short position of Assembly Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Generation Bio and Assembly Biosciences.
Diversification Opportunities for Generation Bio and Assembly Biosciences
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Generation and Assembly is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Generation Bio Co and Assembly Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assembly Biosciences and Generation Bio 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 Generation Bio Co are associated (or correlated) with Assembly Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assembly Biosciences has no effect on the direction of Generation Bio i.e., Generation Bio and Assembly Biosciences go up and down completely randomly.
Pair Corralation between Generation Bio and Assembly Biosciences
Given the investment horizon of 90 days Generation Bio Co is expected to under-perform the Assembly Biosciences. In addition to that, Generation Bio is 1.45 times more volatile than Assembly Biosciences. It trades about -0.31 of its total potential returns per unit of risk. Assembly Biosciences is currently generating about 0.02 per unit of volatility. If you would invest 1,698 in Assembly Biosciences on September 3, 2024 and sell it today you would earn a total of 6.00 from holding Assembly Biosciences or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Generation Bio Co vs. Assembly Biosciences
Performance |
| Timeline |
| Generation Bio |
| Assembly Biosciences |
Generation Bio and Assembly Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Generation Bio and Assembly Biosciences
The main advantage of trading using opposite Generation Bio and Assembly Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Generation Bio position performs unexpectedly, Assembly Biosciences 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 Assembly Biosciences will offset losses from the drop in Assembly Biosciences' long position.| Generation Bio vs. Monte Rosa Therapeutics | Generation Bio vs. Nkarta Inc | Generation Bio vs. Lyell Immunopharma | Generation Bio vs. Sana Biotechnology |
| Assembly Biosciences vs. Spero Therapeutics | Assembly Biosciences vs. Achilles Therapeutics PLC | Assembly Biosciences vs. Instil Bio | Assembly Biosciences vs. CytomX 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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