Correlation Between Orchestra BioMed and CytomX Therapeutics
Can any of the company-specific risk be diversified away by investing in both Orchestra BioMed and CytomX 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 Orchestra BioMed and CytomX Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orchestra BioMed Holdings and CytomX Therapeutics, you can compare the effects of market volatilities on Orchestra BioMed and CytomX 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 Orchestra BioMed with a short position of CytomX Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orchestra BioMed and CytomX Therapeutics.
Diversification Opportunities for Orchestra BioMed and CytomX Therapeutics
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Orchestra and CytomX is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Orchestra BioMed Holdings and CytomX Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CytomX Therapeutics and Orchestra BioMed 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 Orchestra BioMed Holdings are associated (or correlated) with CytomX Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CytomX Therapeutics has no effect on the direction of Orchestra BioMed i.e., Orchestra BioMed and CytomX Therapeutics go up and down completely randomly.
Pair Corralation between Orchestra BioMed and CytomX Therapeutics
Given the investment horizon of 90 days Orchestra BioMed Holdings is expected to generate 1.62 times more return on investment than CytomX Therapeutics. However, Orchestra BioMed is 1.62 times more volatile than CytomX Therapeutics. It trades about 0.02 of its potential returns per unit of risk. CytomX Therapeutics is currently generating about -0.21 per unit of risk. If you would invest 583.00 in Orchestra BioMed Holdings on August 24, 2024 and sell it today you would lose (6.00) from holding Orchestra BioMed Holdings or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orchestra BioMed Holdings vs. CytomX Therapeutics
Performance |
| Timeline |
| Orchestra BioMed Holdings |
| CytomX Therapeutics |
Orchestra BioMed and CytomX Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orchestra BioMed and CytomX Therapeutics
The main advantage of trading using opposite Orchestra BioMed and CytomX Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orchestra BioMed position performs unexpectedly, CytomX 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 CytomX Therapeutics will offset losses from the drop in CytomX Therapeutics' long position.| Orchestra BioMed vs. CytomX Therapeutics | Orchestra BioMed vs. Assembly Biosciences | Orchestra BioMed vs. Achilles Therapeutics PLC | Orchestra BioMed vs. Instil Bio |
| CytomX Therapeutics vs. Lyra Therapeutics | CytomX Therapeutics vs. Hookipa Pharma | CytomX Therapeutics vs. Cingulate Warrants | CytomX Therapeutics vs. SAB Biotherapeutics |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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