Correlation Between Immatics Biotechnologies and Candel Therapeutics
Can any of the company-specific risk be diversified away by investing in both Immatics Biotechnologies 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 Immatics Biotechnologies and Candel Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between immatics biotechnologies GmbH and Candel Therapeutics, you can compare the effects of market volatilities on Immatics Biotechnologies 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 Immatics Biotechnologies with a short position of Candel Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Immatics Biotechnologies and Candel Therapeutics.
Diversification Opportunities for Immatics Biotechnologies and Candel Therapeutics
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Immatics and Candel is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding immatics biotechnologies GmbH and Candel Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candel Therapeutics and Immatics 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 immatics biotechnologies GmbH 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 Immatics Biotechnologies i.e., Immatics Biotechnologies and Candel Therapeutics go up and down completely randomly.
Pair Corralation between Immatics Biotechnologies and Candel Therapeutics
Assuming the 90 days horizon immatics biotechnologies GmbH is expected to under-perform the Candel Therapeutics. In addition to that, Immatics Biotechnologies is 1.7 times more volatile than Candel Therapeutics. It trades about -0.4 of its total potential returns per unit of risk. Candel Therapeutics is currently generating about -0.06 per unit of volatility. If you would invest 519.00 in Candel Therapeutics on September 4, 2024 and sell it today you would lose (62.00) from holding Candel Therapeutics or give up 11.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 85.71% |
| Values | Daily Returns |
immatics biotechnologies GmbH vs. Candel Therapeutics
Performance |
| Timeline |
| Immatics Biotechnologies |
| Candel Therapeutics |
Immatics Biotechnologies and Candel Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Immatics Biotechnologies and Candel Therapeutics
The main advantage of trading using opposite Immatics Biotechnologies and Candel Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Immatics Biotechnologies 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.The idea behind immatics biotechnologies GmbH and Candel Therapeutics 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.
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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