Correlation Between Cullinan Oncology and Replimune

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

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

Diversification Opportunities for Cullinan Oncology and Replimune

-0.64

Correlation Coefficient

Cullinan Oncology  Replimune

Excellent diversification

The 3 months correlation between Cullinan and Replimune is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cullinan Oncology LLC and Replimune Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Replimune Group and Cullinan Oncology 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 Cullinan Oncology LLC are associated (or correlated) with Replimune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Replimune Group has no effect on the direction of Cullinan Oncology i.e., Cullinan Oncology and Replimune go up and down completely randomly.

Pair Corralation between Cullinan Oncology and Replimune

Given the investment horizon of 90 days Cullinan Oncology LLC is expected to under-perform the Replimune. But the stock apears to be less risky and, when comparing its historical volatility, Cullinan Oncology LLC is 1.55 times less risky than Replimune. The stock trades about -0.12 of its potential returns per unit of risk. The Replimune Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,053  in Replimune Group on September 9, 2024 and sell it today you would earn a total of  255.00  from holding Replimune Group or generate 24.22% return on investment over 90 days.

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

Cullinan Oncology LLC  vs.  Replimune Group

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 weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Replimune Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Replimune Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Replimune disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cullinan Oncology and Replimune

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

The idea behind Cullinan Oncology LLC and Replimune Group 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.