Correlation Between Centessa Pharmaceuticals and INTNED

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

By analyzing existing cross correlation between Centessa Pharmaceuticals PLC and INTNED 4252 28 MAR 33, you can compare the effects of market volatilities on Centessa Pharmaceuticals and INTNED 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 Centessa Pharmaceuticals with a short position of INTNED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centessa Pharmaceuticals and INTNED.

Diversification Opportunities for Centessa Pharmaceuticals and INTNED

-0.34

Correlation Coefficient

Centessa Pharmaceuticals  INTNED

Very good diversification

The 3 months correlation between Centessa and INTNED is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Centessa Pharmaceuticals PLC and INTNED 4252 28 MAR 33 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTNED 4252 28 and Centessa Pharmaceuticals 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 Centessa Pharmaceuticals PLC are associated (or correlated) with INTNED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTNED 4252 28 has no effect on the direction of Centessa Pharmaceuticals i.e., Centessa Pharmaceuticals and INTNED go up and down completely randomly.

Pair Corralation between Centessa Pharmaceuticals and INTNED

Given the investment horizon of 90 days Centessa Pharmaceuticals PLC is expected to generate 1.77 times more return on investment than INTNED. However, Centessa Pharmaceuticals is 1.77 times more volatile than INTNED 4252 28 MAR 33. It trades about 0.07 of its potential returns per unit of risk. INTNED 4252 28 MAR 33 is currently generating about -0.24 per unit of risk. If you would invest  1,683  in Centessa Pharmaceuticals PLC on September 20, 2024 and sell it today you would earn a total of  72.00  from holding Centessa Pharmaceuticals PLC or generate 4.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.91%
Values	Daily Returns

Centessa Pharmaceuticals PLC  vs.  INTNED 4252 28 MAR 33

Centessa Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Weak

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

INTNED 4252 28

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INTNED 4252 28 MAR 33 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Bond's basic indicators remain somewhat 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 INTNED 4252 28 MAR 33 investors.

Pair Trading with Centessa Pharmaceuticals and INTNED

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

The idea behind Centessa Pharmaceuticals PLC and INTNED 4252 28 MAR 33 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.