Correlation Between AnaptysBio and Abcam PLC

Can any of the company-specific risk be diversified away by investing in both AnaptysBio and Abcam PLC 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 AnaptysBio and Abcam PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AnaptysBio and Abcam PLC, you can compare the effects of market volatilities on AnaptysBio and Abcam PLC 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 AnaptysBio with a short position of Abcam PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of AnaptysBio and Abcam PLC.

Diversification Opportunities for AnaptysBio and Abcam PLC

-0.92

Correlation Coefficient

AnaptysBio  Abcam PLC

Pay attention - limited upside

The 3 months correlation between AnaptysBio and Abcam is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding AnaptysBio and Abcam PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abcam PLC and AnaptysBio 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 AnaptysBio are associated (or correlated) with Abcam PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abcam PLC has no effect on the direction of AnaptysBio i.e., AnaptysBio and Abcam PLC go up and down completely randomly.

Pair Corralation between AnaptysBio and Abcam PLC

If you would invest  2,359  in Abcam PLC on September 2, 2024 and sell it today you would earn a total of  0.00  from holding Abcam PLC or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.56%
Values	Daily Returns

AnaptysBio  vs.  Abcam PLC

AnaptysBio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AnaptysBio has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Abcam PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Abcam PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Abcam PLC is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with AnaptysBio and Abcam PLC

The main advantage of trading using opposite AnaptysBio and Abcam PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AnaptysBio position performs unexpectedly, Abcam PLC 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 Abcam PLC will offset losses from the drop in Abcam PLC's long position.

The idea behind AnaptysBio and Abcam PLC 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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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.