Correlation Between Connect Biopharma and Cyclacel Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Connect Biopharma and Cyclacel 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 Connect Biopharma and Cyclacel Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Connect Biopharma Holdings and Cyclacel Pharmaceuticals, you can compare the effects of market volatilities on Connect Biopharma and Cyclacel 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 Connect Biopharma with a short position of Cyclacel Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Connect Biopharma and Cyclacel Pharmaceuticals.
Diversification Opportunities for Connect Biopharma and Cyclacel Pharmaceuticals
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Connect and Cyclacel is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Connect Biopharma Holdings and Cyclacel Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cyclacel Pharmaceuticals and Connect Biopharma 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 Connect Biopharma Holdings are associated (or correlated) with Cyclacel Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cyclacel Pharmaceuticals has no effect on the direction of Connect Biopharma i.e., Connect Biopharma and Cyclacel Pharmaceuticals go up and down completely randomly.
Pair Corralation between Connect Biopharma and Cyclacel Pharmaceuticals
Given the investment horizon of 90 days Connect Biopharma Holdings is expected to generate 0.81 times more return on investment than Cyclacel Pharmaceuticals. However, Connect Biopharma Holdings is 1.24 times less risky than Cyclacel Pharmaceuticals. It trades about -0.03 of its potential returns per unit of risk. Cyclacel Pharmaceuticals is currently generating about -0.03 per unit of risk. If you would invest 108.00 in Connect Biopharma Holdings on December 2, 2024 and sell it today you would lose (17.00) from holding Connect Biopharma Holdings or give up 15.74% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Connect Biopharma Holdings vs. Cyclacel Pharmaceuticals
Performance |
Timeline |
Connect Biopharma |
Cyclacel Pharmaceuticals |
Connect Biopharma and Cyclacel Pharmaceuticals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Connect Biopharma and Cyclacel Pharmaceuticals
The main advantage of trading using opposite Connect Biopharma and Cyclacel Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Connect Biopharma position performs unexpectedly, Cyclacel 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 Cyclacel Pharmaceuticals will offset losses from the drop in Cyclacel Pharmaceuticals' long position.Connect Biopharma vs. Assembly Biosciences | Connect Biopharma vs. Instil Bio | Connect Biopharma vs. CytomX Therapeutics | Connect Biopharma vs. Achilles Therapeutics PLC |
Cyclacel Pharmaceuticals vs. Ikena Oncology | Cyclacel Pharmaceuticals vs. Ovid Therapeutics | Cyclacel Pharmaceuticals vs. Connect Biopharma Holdings | Cyclacel Pharmaceuticals vs. Edgewise Therapeutics |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Transaction History View history of all your transactions and understand their impact on performance | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |