Correlation Between Cue Biopharma and Fennec Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Cue Biopharma and Fennec 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 Cue Biopharma and Fennec Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cue Biopharma and Fennec Pharmaceuticals, you can compare the effects of market volatilities on Cue Biopharma and Fennec 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 Cue Biopharma with a short position of Fennec Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cue Biopharma and Fennec Pharmaceuticals.
Diversification Opportunities for Cue Biopharma and Fennec Pharmaceuticals
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cue and Fennec is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Cue Biopharma and Fennec Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fennec Pharmaceuticals and Cue 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 Cue Biopharma are associated (or correlated) with Fennec Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fennec Pharmaceuticals has no effect on the direction of Cue Biopharma i.e., Cue Biopharma and Fennec Pharmaceuticals go up and down completely randomly.
Pair Corralation between Cue Biopharma and Fennec Pharmaceuticals
Considering the 90-day investment horizon Cue Biopharma is expected to generate 2.07 times more return on investment than Fennec Pharmaceuticals. However, Cue Biopharma is 2.07 times more volatile than Fennec Pharmaceuticals. It trades about 0.01 of its potential returns per unit of risk. Fennec Pharmaceuticals is currently generating about 0.01 per unit of risk. If you would invest 268.00 in Cue Biopharma on December 1, 2024 and sell it today you would lose (145.00) from holding Cue Biopharma or give up 54.1% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Cue Biopharma vs. Fennec Pharmaceuticals
Performance |
Timeline |
Cue Biopharma |
Fennec Pharmaceuticals |
Cue Biopharma and Fennec Pharmaceuticals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cue Biopharma and Fennec Pharmaceuticals
The main advantage of trading using opposite Cue Biopharma and Fennec Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cue Biopharma position performs unexpectedly, Fennec 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 Fennec Pharmaceuticals will offset losses from the drop in Fennec Pharmaceuticals' long position.Cue Biopharma vs. Beam Therapeutics | Cue Biopharma vs. Editas Medicine | Cue Biopharma vs. Caribou Biosciences | Cue Biopharma vs. Verve Therapeutics |
Fennec Pharmaceuticals vs. Beam Therapeutics | Fennec Pharmaceuticals vs. Editas Medicine | Fennec Pharmaceuticals vs. Caribou Biosciences | Fennec Pharmaceuticals vs. Verve 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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