Correlation Between Cantargia and Sprint Bioscience

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

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

Diversification Opportunities for Cantargia and Sprint Bioscience

0.18

Correlation Coefficient

Cantargia  Sprint Bioscience

Average diversification

The 3 months correlation between Cantargia and Sprint is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cantargia AB and Sprint Bioscience AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprint Bioscience and Cantargia 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 Cantargia AB are associated (or correlated) with Sprint Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprint Bioscience has no effect on the direction of Cantargia i.e., Cantargia and Sprint Bioscience go up and down completely randomly.

Pair Corralation between Cantargia and Sprint Bioscience

Assuming the 90 days trading horizon Cantargia AB is expected to generate 1.01 times more return on investment than Sprint Bioscience. However, Cantargia is 1.01 times more volatile than Sprint Bioscience AB. It trades about -0.04 of its potential returns per unit of risk. Sprint Bioscience AB is currently generating about -0.08 per unit of risk. If you would invest  180.00  in Cantargia AB on November 29, 2024 and sell it today you would lose (10.00) from holding Cantargia AB or give up 5.56% of portfolio value over 90 days.

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

Cantargia AB  vs.  Sprint Bioscience AB

Cantargia AB

Risk-Adjusted Performance

Very Weak

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

Sprint Bioscience

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Cantargia and Sprint Bioscience

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

The idea behind Cantargia AB and Sprint Bioscience AB 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.