Correlation Between Cingulate Warrants and Humacyte

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

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

Diversification Opportunities for Cingulate Warrants and Humacyte

0.12

Correlation Coefficient

Cingulate Warrants  Humacyte

Average diversification

The 3 months correlation between Cingulate and Humacyte is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Cingulate Warrants and Humacyte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humacyte and Cingulate Warrants 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 Cingulate Warrants are associated (or correlated) with Humacyte. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humacyte has no effect on the direction of Cingulate Warrants i.e., Cingulate Warrants and Humacyte go up and down completely randomly.

Pair Corralation between Cingulate Warrants and Humacyte

Assuming the 90 days horizon Cingulate Warrants is expected to generate 15.47 times more return on investment than Humacyte. However, Cingulate Warrants is 15.47 times more volatile than Humacyte. It trades about 0.16 of its potential returns per unit of risk. Humacyte is currently generating about 0.1 per unit of risk. If you would invest  2.75  in Cingulate Warrants on September 4, 2024 and sell it today you would earn a total of  2.10  from holding Cingulate Warrants or generate 76.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	78.19%
Values	Daily Returns

Cingulate Warrants  vs.  Humacyte

Cingulate Warrants

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cingulate Warrants are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile technical and fundamental indicators, Cingulate Warrants showed solid returns over the last few months and may actually be approaching a breakup point.

Humacyte

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Humacyte are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, Humacyte may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Cingulate Warrants and Humacyte

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

The idea behind Cingulate Warrants and Humacyte 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .