Correlation Between MAIA Biotechnology and Frequency Therapeutics
Can any of the company-specific risk be diversified away by investing in both MAIA Biotechnology and Frequency 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 MAIA Biotechnology and Frequency Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAIA Biotechnology and Frequency Therapeutics, you can compare the effects of market volatilities on MAIA Biotechnology and Frequency 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 MAIA Biotechnology with a short position of Frequency Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAIA Biotechnology and Frequency Therapeutics.
Diversification Opportunities for MAIA Biotechnology and Frequency Therapeutics
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAIA and Frequency is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding MAIA Biotechnology and Frequency Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequency Therapeutics and MAIA Biotechnology 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 MAIA Biotechnology are associated (or correlated) with Frequency Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequency Therapeutics has no effect on the direction of MAIA Biotechnology i.e., MAIA Biotechnology and Frequency Therapeutics go up and down completely randomly.
Pair Corralation between MAIA Biotechnology and Frequency Therapeutics
Given the investment horizon of 90 days MAIA Biotechnology is expected to generate 6.52 times less return on investment than Frequency Therapeutics. But when comparing it to its historical volatility, MAIA Biotechnology is 1.82 times less risky than Frequency Therapeutics. It trades about 0.02 of its potential returns per unit of risk. Frequency Therapeutics is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 39.00 in Frequency Therapeutics on August 29, 2024 and sell it today you would earn a total of 13.00 from holding Frequency Therapeutics or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 13.74% |
| Values | Daily Returns |
MAIA Biotechnology vs. Frequency Therapeutics
Performance |
| Timeline |
| MAIA Biotechnology |
| Frequency Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MAIA Biotechnology and Frequency Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAIA Biotechnology and Frequency Therapeutics
The main advantage of trading using opposite MAIA Biotechnology and Frequency Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAIA Biotechnology position performs unexpectedly, Frequency 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 Frequency Therapeutics will offset losses from the drop in Frequency Therapeutics' long position.| MAIA Biotechnology vs. Lineage Cell Therapeutics | MAIA Biotechnology vs. Armata Pharmaceuticals | MAIA Biotechnology vs. Portage Biotech | MAIA Biotechnology vs. Larimar Therapeutics |
| Frequency Therapeutics vs. Lineage Cell Therapeutics | Frequency Therapeutics vs. MAIA Biotechnology | Frequency Therapeutics vs. Armata Pharmaceuticals | Frequency Therapeutics vs. Portage Biotech |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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