Correlation Between Candel Therapeutics and Akebia Ther

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

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

Diversification Opportunities for Candel Therapeutics and Akebia Ther

-0.83

Correlation Coefficient

Candel Therapeutics  Akebia Ther

Pay attention - limited upside

The 3 months correlation between Candel and Akebia is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Candel Therapeutics and Akebia Ther in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akebia Ther and Candel 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 Candel Therapeutics are associated (or correlated) with Akebia Ther. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akebia Ther has no effect on the direction of Candel Therapeutics i.e., Candel Therapeutics and Akebia Ther go up and down completely randomly.

Pair Corralation between Candel Therapeutics and Akebia Ther

Given the investment horizon of 90 days Candel Therapeutics is expected to under-perform the Akebia Ther. In addition to that, Candel Therapeutics is 1.3 times more volatile than Akebia Ther. It trades about -0.09 of its total potential returns per unit of risk. Akebia Ther is currently generating about 0.15 per unit of volatility. If you would invest  144.00  in Akebia Ther on September 12, 2024 and sell it today you would earn a total of  54.00  from holding Akebia Ther or generate 37.5% return on investment over 90 days.

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

Candel Therapeutics  vs.  Akebia Ther

Candel Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Candel Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Akebia Ther

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Akebia Ther are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, Akebia Ther sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Candel Therapeutics and Akebia Ther

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

The idea behind Candel Therapeutics and Akebia Ther 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.