Correlation Between HP and Curis
Can any of the company-specific risk be diversified away by investing in both HP and Curis 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 HP and Curis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HP Inc and Curis Inc, you can compare the effects of market volatilities on HP and Curis 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 HP with a short position of Curis. Check out your portfolio center. Please also check ongoing floating volatility patterns of HP and Curis.
Diversification Opportunities for HP and Curis
Excellent diversification
The 3 months correlation between HP and Curis is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding HP Inc and Curis Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curis Inc and HP 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 HP Inc are associated (or correlated) with Curis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curis Inc has no effect on the direction of HP i.e., HP and Curis go up and down completely randomly.
Pair Corralation between HP and Curis
Considering the 90-day investment horizon HP Inc is expected to generate 0.84 times more return on investment than Curis. However, HP Inc is 1.19 times less risky than Curis. It trades about -0.11 of its potential returns per unit of risk. Curis Inc is currently generating about -0.21 per unit of risk. If you would invest 3,742 in HP Inc on August 29, 2024 and sell it today you would lose (328.00) from holding HP Inc or give up 8.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HP Inc vs. Curis Inc
Performance |
| Timeline |
| HP Inc |
| Curis Inc |
HP and Curis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HP and Curis
The main advantage of trading using opposite HP and Curis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HP position performs unexpectedly, Curis 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 Curis will offset losses from the drop in Curis' long position.The idea behind HP Inc and Curis Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Curis vs. Aileron Therapeutics | Curis vs. Artelo Biosciences | Curis vs. Histogen | Curis vs. X4 Pharmaceuticals |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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