Correlation Between Cingulate Warrants and Vaxcyte

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

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

Diversification Opportunities for Cingulate Warrants and Vaxcyte

0.59

Correlation Coefficient

Cingulate Warrants  Vaxcyte

Very weak diversification

The 3 months correlation between Cingulate and Vaxcyte is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Cingulate Warrants and Vaxcyte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vaxcyte 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 Vaxcyte. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vaxcyte has no effect on the direction of Cingulate Warrants i.e., Cingulate Warrants and Vaxcyte go up and down completely randomly.

Pair Corralation between Cingulate Warrants and Vaxcyte

Assuming the 90 days horizon Cingulate Warrants is expected to generate 7.69 times more return on investment than Vaxcyte. However, Cingulate Warrants is 7.69 times more volatile than Vaxcyte. It trades about 0.06 of its potential returns per unit of risk. Vaxcyte is currently generating about -0.14 per unit of risk. If you would invest  5.77  in Cingulate Warrants on September 5, 2024 and sell it today you would lose (0.92) from holding Cingulate Warrants or give up 15.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Cingulate Warrants  vs.  Vaxcyte

Cingulate Warrants

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cingulate Warrants are ranked lower than 4 (%) 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.

Vaxcyte

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Cingulate Warrants and Vaxcyte

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

The idea behind Cingulate Warrants and Vaxcyte 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.