Correlation Between Bolt Biotherapeutics and Cullinan Oncology

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

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

Diversification Opportunities for Bolt Biotherapeutics and Cullinan Oncology

0.57

Correlation Coefficient

Bolt Biotherapeutics  Cullinan Oncology

Very weak diversification

The 3 months correlation between Bolt and Cullinan is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bolt Biotherapeutics and Cullinan Oncology LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullinan Oncology LLC and Bolt Biotherapeutics 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 Bolt Biotherapeutics are associated (or correlated) with Cullinan Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullinan Oncology LLC has no effect on the direction of Bolt Biotherapeutics i.e., Bolt Biotherapeutics and Cullinan Oncology go up and down completely randomly.

Pair Corralation between Bolt Biotherapeutics and Cullinan Oncology

Given the investment horizon of 90 days Bolt Biotherapeutics is expected to generate 0.72 times more return on investment than Cullinan Oncology. However, Bolt Biotherapeutics is 1.39 times less risky than Cullinan Oncology. It trades about -0.03 of its potential returns per unit of risk. Cullinan Oncology LLC is currently generating about -0.13 per unit of risk. If you would invest  68.00  in Bolt Biotherapeutics on August 31, 2024 and sell it today you would lose (5.00) from holding Bolt Biotherapeutics or give up 7.35% of portfolio value over 90 days.

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

Bolt Biotherapeutics  vs.  Cullinan Oncology LLC

Bolt Biotherapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bolt Biotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Bolt Biotherapeutics is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Cullinan Oncology LLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cullinan Oncology LLC 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Bolt Biotherapeutics and Cullinan Oncology

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

The idea behind Bolt Biotherapeutics and Cullinan Oncology LLC 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 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.