Correlation Between Coya Therapeutics, and BridgeBio Pharma

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

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

Diversification Opportunities for Coya Therapeutics, and BridgeBio Pharma

-0.3

Correlation Coefficient

Coya Therapeutics,  BridgeBio Pharma

Very good diversification

The 3 months correlation between Coya and BridgeBio is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Coya Therapeutics, Common and BridgeBio Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BridgeBio Pharma and Coya Therapeutics, 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 Coya Therapeutics, Common are associated (or correlated) with BridgeBio Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BridgeBio Pharma has no effect on the direction of Coya Therapeutics, i.e., Coya Therapeutics, and BridgeBio Pharma go up and down completely randomly.

Pair Corralation between Coya Therapeutics, and BridgeBio Pharma

Given the investment horizon of 90 days Coya Therapeutics, Common is expected to under-perform the BridgeBio Pharma. But the stock apears to be less risky and, when comparing its historical volatility, Coya Therapeutics, Common is 1.45 times less risky than BridgeBio Pharma. The stock trades about -0.23 of its potential returns per unit of risk. The BridgeBio Pharma is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2,612  in BridgeBio Pharma on September 11, 2024 and sell it today you would earn a total of  338.00  from holding BridgeBio Pharma or generate 12.94% return on investment over 90 days.

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

Coya Therapeutics, Common  vs.  BridgeBio Pharma

Coya Therapeutics, Common

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Coya Therapeutics, Common are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, Coya Therapeutics, sustained solid returns over the last few months and may actually be approaching a breakup point.

BridgeBio Pharma

Risk-Adjusted Performance

3 of 100

Very Weak

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

Pair Trading with Coya Therapeutics, and BridgeBio Pharma

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

The idea behind Coya Therapeutics, Common and BridgeBio Pharma 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.