Correlation Between Climb Bio and Telix Pharmaceuticals

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

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

Diversification Opportunities for Climb Bio and Telix Pharmaceuticals

-0.01

Correlation Coefficient

Climb Bio  Telix Pharmaceuticals

Good diversification

The 3 months correlation between Climb and Telix is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Climb Bio and Telix Pharmaceuticals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telix Pharmaceuticals and Climb Bio 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 Climb Bio are associated (or correlated) with Telix Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telix Pharmaceuticals has no effect on the direction of Climb Bio i.e., Climb Bio and Telix Pharmaceuticals go up and down completely randomly.

Pair Corralation between Climb Bio and Telix Pharmaceuticals

Given the investment horizon of 90 days Climb Bio is expected to under-perform the Telix Pharmaceuticals. In addition to that, Climb Bio is 2.43 times more volatile than Telix Pharmaceuticals Limited. It trades about -0.37 of its total potential returns per unit of risk. Telix Pharmaceuticals Limited is currently generating about -0.06 per unit of volatility. If you would invest  1,619  in Telix Pharmaceuticals Limited on October 1, 2024 and sell it today you would lose (59.00) from holding Telix Pharmaceuticals Limited or give up 3.64% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Climb Bio  vs.  Telix Pharmaceuticals Limited

Climb Bio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Climb Bio 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 basic 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.

Telix Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Insignificant

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

Pair Trading with Climb Bio and Telix Pharmaceuticals

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

The idea behind Climb Bio and Telix Pharmaceuticals Limited 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.

Check out your portfolio center.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.