Correlation Between Gracell Biotechnologies and Passage Bio
Can any of the company-specific risk be diversified away by investing in both Gracell Biotechnologies and Passage 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 Gracell Biotechnologies and Passage Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gracell Biotechnologies and Passage Bio, you can compare the effects of market volatilities on Gracell Biotechnologies and Passage 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 Gracell Biotechnologies with a short position of Passage Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gracell Biotechnologies and Passage Bio.
Diversification Opportunities for Gracell Biotechnologies and Passage Bio
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gracell and Passage is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Gracell Biotechnologies and Passage Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Passage Bio 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 Passage Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Passage Bio has no effect on the direction of Gracell Biotechnologies i.e., Gracell Biotechnologies and Passage Bio go up and down completely randomly.
Pair Corralation between Gracell Biotechnologies and Passage Bio
If you would invest 62.00 in Passage Bio on August 31, 2024 and sell it today you would earn a total of 5.00 from holding Passage Bio or generate 8.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Gracell Biotechnologies vs. Passage Bio
Performance |
| Timeline |
| Gracell Biotechnologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Passage Bio |
Gracell Biotechnologies and Passage Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gracell Biotechnologies and Passage Bio
The main advantage of trading using opposite Gracell Biotechnologies and Passage Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gracell Biotechnologies position performs unexpectedly, Passage 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 Passage Bio will offset losses from the drop in Passage Bio's long position.| Gracell Biotechnologies vs. Monte Rosa Therapeutics | Gracell Biotechnologies vs. Design Therapeutics | Gracell Biotechnologies vs. Erasca Inc | Gracell Biotechnologies vs. NextCure |
| Passage Bio vs. Cue Biopharma | Passage Bio vs. Tff Pharmaceuticals | Passage Bio vs. Eliem Therapeutics | Passage Bio vs. Inhibrx |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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