Correlation Between Cingulate Warrants and Xenon Pharmaceuticals

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

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

Diversification Opportunities for Cingulate Warrants and Xenon Pharmaceuticals

-0.49

Correlation Coefficient

Cingulate Warrants  Xenon Pharmaceuticals

Very good diversification

The 3 months correlation between Cingulate and Xenon is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Cingulate Warrants and Xenon Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xenon Pharmaceuticals 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 Xenon Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xenon Pharmaceuticals has no effect on the direction of Cingulate Warrants i.e., Cingulate Warrants and Xenon Pharmaceuticals go up and down completely randomly.

Pair Corralation between Cingulate Warrants and Xenon Pharmaceuticals

Assuming the 90 days horizon Cingulate Warrants is expected to generate 28.69 times less return on investment than Xenon Pharmaceuticals. In addition to that, Cingulate Warrants is 7.34 times more volatile than Xenon Pharmaceuticals. It trades about 0.0 of its total potential returns per unit of risk. Xenon Pharmaceuticals is currently generating about 0.05 per unit of volatility. If you would invest  4,084  in Xenon Pharmaceuticals on September 13, 2024 and sell it today you would earn a total of  213.00  from holding Xenon Pharmaceuticals or generate 5.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Cingulate Warrants  vs.  Xenon Pharmaceuticals

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.

Xenon Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Modest

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

Pair Trading with Cingulate Warrants and Xenon Pharmaceuticals

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

The idea behind Cingulate Warrants and Xenon Pharmaceuticals 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.