Correlation Between Gracell Biotechnologies and Amylyx Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Gracell Biotechnologies and Amylyx Pharmaceuticals 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 Gracell Biotechnologies and Amylyx Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gracell Biotechnologies and Amylyx Pharmaceuticals, you can compare the effects of market volatilities on Gracell Biotechnologies and Amylyx Pharmaceuticals 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 Gracell Biotechnologies with a short position of Amylyx Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gracell Biotechnologies and Amylyx Pharmaceuticals.
Diversification Opportunities for Gracell Biotechnologies and Amylyx Pharmaceuticals
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gracell and Amylyx is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Gracell Biotechnologies and Amylyx Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amylyx Pharmaceuticals and Gracell Biotechnologies 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 Gracell Biotechnologies are associated (or correlated) with Amylyx Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amylyx Pharmaceuticals has no effect on the direction of Gracell Biotechnologies i.e., Gracell Biotechnologies and Amylyx Pharmaceuticals go up and down completely randomly.
Pair Corralation between Gracell Biotechnologies and Amylyx Pharmaceuticals
Given the investment horizon of 90 days Gracell Biotechnologies is expected to generate 1.61 times more return on investment than Amylyx Pharmaceuticals. However, Gracell Biotechnologies is 1.61 times more volatile than Amylyx Pharmaceuticals. It trades about 0.05 of its potential returns per unit of risk. Amylyx Pharmaceuticals is currently generating about -0.01 per unit of risk. If you would invest 393.00 in Gracell Biotechnologies on August 31, 2024 and sell it today you would earn a total of 9.00 from holding Gracell Biotechnologies or generate 2.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 8.56% |
| Values | Daily Returns |
Gracell Biotechnologies vs. Amylyx Pharmaceuticals
Performance |
| Timeline |
| Gracell Biotechnologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Amylyx Pharmaceuticals |
Gracell Biotechnologies and Amylyx Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gracell Biotechnologies and Amylyx Pharmaceuticals
The main advantage of trading using opposite Gracell Biotechnologies and Amylyx Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gracell Biotechnologies position performs unexpectedly, Amylyx Pharmaceuticals 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 Amylyx Pharmaceuticals will offset losses from the drop in Amylyx Pharmaceuticals' long position.| Gracell Biotechnologies vs. Monte Rosa Therapeutics | Gracell Biotechnologies vs. Design Therapeutics | Gracell Biotechnologies vs. Erasca Inc | Gracell Biotechnologies vs. NextCure |
| Amylyx Pharmaceuticals vs. Dogwood Therapeutics, | Amylyx Pharmaceuticals vs. Enlivex Therapeutics | Amylyx Pharmaceuticals vs. Ensysce Biosciences | Amylyx Pharmaceuticals vs. Entero 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |