Correlation Between Gilead Sciences and Mustang Bio
Can any of the company-specific risk be diversified away by investing in both Gilead Sciences and Mustang 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 Gilead Sciences and Mustang Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gilead Sciences and Mustang Bio, you can compare the effects of market volatilities on Gilead Sciences and Mustang 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 Gilead Sciences with a short position of Mustang Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilead Sciences and Mustang Bio.
Diversification Opportunities for Gilead Sciences and Mustang Bio
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gilead and Mustang is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Gilead Sciences and Mustang Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mustang Bio 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 Mustang Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mustang Bio has no effect on the direction of Gilead Sciences i.e., Gilead Sciences and Mustang Bio go up and down completely randomly.
Pair Corralation between Gilead Sciences and Mustang Bio
Given the investment horizon of 90 days Gilead Sciences is expected to generate 0.08 times more return on investment than Mustang Bio. However, Gilead Sciences is 12.65 times less risky than Mustang Bio. It trades about -0.09 of its potential returns per unit of risk. Mustang Bio is currently generating about -0.12 per unit of risk. If you would invest 9,340 in Gilead Sciences on October 22, 2024 and sell it today you would lose (156.00) from holding Gilead Sciences or give up 1.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gilead Sciences vs. Mustang Bio
Performance |
| Timeline |
| Gilead Sciences |
| Mustang Bio |
Gilead Sciences and Mustang Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gilead Sciences and Mustang Bio
The main advantage of trading using opposite Gilead Sciences and Mustang Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilead Sciences position performs unexpectedly, Mustang 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 Mustang Bio will offset losses from the drop in Mustang Bio's long position.| Gilead Sciences vs. Amgen Inc | Gilead Sciences vs. Merck Company | Gilead Sciences vs. AbbVie Inc | Gilead Sciences vs. Johnson Johnson |
| Mustang Bio vs. Checkpoint Therapeutics | Mustang Bio vs. Reviva Pharmaceuticals Holdings | Mustang Bio vs. Fortress Biotech Pref | Mustang Bio vs. Kodiak Sciences |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Positions Ratings 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 | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |