Correlation Between Apexigen and First Wave

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

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

Diversification Opportunities for Apexigen and First Wave

0.0

Correlation Coefficient

Apexigen  First Wave

Pay attention - limited upside

The 3 months correlation between Apexigen and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Apexigen and First Wave BioPharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Wave BioPharma and Apexigen 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 Apexigen are associated (or correlated) with First Wave. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Wave BioPharma has no effect on the direction of Apexigen i.e., Apexigen and First Wave go up and down completely randomly.

Pair Corralation between Apexigen and First Wave

If you would invest  61.00  in First Wave BioPharma on October 6, 2024 and sell it today you would earn a total of  0.00  from holding First Wave BioPharma or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Apexigen  vs.  First Wave BioPharma

Apexigen

Risk-Adjusted Performance

0 of 100

Very Weak

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

First Wave BioPharma

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days First Wave BioPharma has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, First Wave is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Apexigen and First Wave

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

The idea behind Apexigen and First Wave 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.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.