Correlation Between Beam Therapeutics and Seer

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

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

Diversification Opportunities for Beam Therapeutics and Seer

0.28

Correlation Coefficient

Beam Therapeutics  Seer

Modest diversification

The 3 months correlation between Beam and Seer is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Beam Therapeutics and Seer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seer Inc and Beam Therapeutics 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 Beam Therapeutics are associated (or correlated) with Seer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seer Inc has no effect on the direction of Beam Therapeutics i.e., Beam Therapeutics and Seer go up and down completely randomly.

Pair Corralation between Beam Therapeutics and Seer

Given the investment horizon of 90 days Beam Therapeutics is expected to under-perform the Seer. In addition to that, Beam Therapeutics is 2.22 times more volatile than Seer Inc. It trades about -0.06 of its total potential returns per unit of risk. Seer Inc is currently generating about -0.12 per unit of volatility. If you would invest  221.00  in Seer Inc on December 24, 2024 and sell it today you would lose (33.00) from holding Seer Inc or give up 14.93% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Beam Therapeutics  vs.  Seer Inc

Beam Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Beam Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Seer Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Seer Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Beam Therapeutics and Seer

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

The idea behind Beam Therapeutics and Seer Inc 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.