Correlation Between Gilead Sciences and Candel Therapeutics
Can any of the company-specific risk be diversified away by investing in both Gilead Sciences 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 Gilead Sciences and Candel Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gilead Sciences and Candel Therapeutics, you can compare the effects of market volatilities on Gilead Sciences 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 Gilead Sciences with a short position of Candel Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilead Sciences and Candel Therapeutics.
Diversification Opportunities for Gilead Sciences and Candel Therapeutics
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gilead and Candel is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Gilead Sciences and Candel Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candel Therapeutics and Gilead Sciences 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 Gilead Sciences 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 Gilead Sciences i.e., Gilead Sciences and Candel Therapeutics go up and down completely randomly.
Pair Corralation between Gilead Sciences and Candel Therapeutics
Given the investment horizon of 90 days Gilead Sciences is expected to under-perform the Candel Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Gilead Sciences is 11.06 times less risky than Candel Therapeutics. The stock trades about -0.06 of its potential returns per unit of risk. The Candel Therapeutics is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 447.00 in Candel Therapeutics on September 13, 2024 and sell it today you would earn a total of 328.00 from holding Candel Therapeutics or generate 73.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gilead Sciences vs. Candel Therapeutics
Performance |
| Timeline |
| Gilead Sciences |
| Candel Therapeutics |
Gilead Sciences and Candel Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gilead Sciences and Candel Therapeutics
The main advantage of trading using opposite Gilead Sciences and Candel Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilead Sciences 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.| Gilead Sciences vs. Puma Biotechnology | Gilead Sciences vs. Iovance Biotherapeutics | Gilead Sciences vs. Sarepta Therapeutics | Gilead Sciences vs. Day One Biopharmaceuticals |
| 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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