Correlation Between PolyPid and Cue Biopharma
Can any of the company-specific risk be diversified away by investing in both PolyPid and Cue Biopharma 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 PolyPid and Cue Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PolyPid and Cue Biopharma, you can compare the effects of market volatilities on PolyPid and Cue Biopharma 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 PolyPid with a short position of Cue Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of PolyPid and Cue Biopharma.
Diversification Opportunities for PolyPid and Cue Biopharma
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PolyPid and Cue is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding PolyPid and Cue Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cue Biopharma and PolyPid 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 PolyPid are associated (or correlated) with Cue Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cue Biopharma has no effect on the direction of PolyPid i.e., PolyPid and Cue Biopharma go up and down completely randomly.
Pair Corralation between PolyPid and Cue Biopharma
Given the investment horizon of 90 days PolyPid is expected to generate 9.84 times less return on investment than Cue Biopharma. But when comparing it to its historical volatility, PolyPid is 1.2 times less risky than Cue Biopharma. It trades about 0.02 of its potential returns per unit of risk. Cue Biopharma is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 103.00 in Cue Biopharma on November 4, 2024 and sell it today you would earn a total of 42.00 from holding Cue Biopharma or generate 40.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PolyPid vs. Cue Biopharma
Performance |
| Timeline |
| PolyPid |
| Cue Biopharma |
PolyPid and Cue Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PolyPid and Cue Biopharma
The main advantage of trading using opposite PolyPid and Cue Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PolyPid position performs unexpectedly, Cue Biopharma 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 Cue Biopharma will offset losses from the drop in Cue Biopharma's long position.The idea behind PolyPid and Cue Biopharma 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.| Cue Biopharma vs. Coya Therapeutics, Common | Cue Biopharma vs. Lantern Pharma | Cue Biopharma vs. Fennec Pharmaceuticals | Cue Biopharma vs. Anixa Biosciences |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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