Correlation Between Cingulate Warrants and Kronos Bio

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

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

Diversification Opportunities for Cingulate Warrants and Kronos Bio

0.14

Correlation Coefficient

Cingulate Warrants  Kronos Bio

Average diversification

The 3 months correlation between Cingulate and Kronos is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cingulate Warrants and Kronos Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kronos Bio 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 Kronos Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kronos Bio has no effect on the direction of Cingulate Warrants i.e., Cingulate Warrants and Kronos Bio go up and down completely randomly.

Pair Corralation between Cingulate Warrants and Kronos Bio

Assuming the 90 days horizon Cingulate Warrants is expected to generate 51.94 times less return on investment than Kronos Bio. In addition to that, Cingulate Warrants is 4.04 times more volatile than Kronos Bio. It trades about 0.0 of its total potential returns per unit of risk. Kronos Bio is currently generating about 0.05 per unit of volatility. If you would invest  95.00  in Kronos Bio on September 13, 2024 and sell it today you would earn a total of  7.00  from holding Kronos Bio or generate 7.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Cingulate Warrants  vs.  Kronos Bio

Cingulate Warrants

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cingulate Warrants has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Cingulate Warrants is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Kronos Bio

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Kronos Bio are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Kronos Bio may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Cingulate Warrants and Kronos Bio

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

The idea behind Cingulate Warrants and Kronos Bio 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.