Correlation Between Comera Life and Frequency Therapeutics

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

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

Diversification Opportunities for Comera Life and Frequency Therapeutics

0.0

Correlation Coefficient

Comera Life  Frequency Therapeutics

Pay attention - limited upside

The 3 months correlation between Comera and Frequency is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Comera Life Sciences and Frequency Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequency Therapeutics and Comera Life 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 Comera Life Sciences are associated (or correlated) with Frequency Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequency Therapeutics has no effect on the direction of Comera Life i.e., Comera Life and Frequency Therapeutics go up and down completely randomly.

Pair Corralation between Comera Life and Frequency Therapeutics

If you would invest (100.00) in Frequency Therapeutics on November 29, 2024 and sell it today you would earn a total of  100.00  from holding Frequency Therapeutics or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Comera Life Sciences  vs.  Frequency Therapeutics

Comera Life Sciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Comera Life Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Comera Life is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Frequency Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Frequency Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Frequency Therapeutics is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Comera Life and Frequency Therapeutics

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

The idea behind Comera Life Sciences and Frequency Therapeutics 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.