Correlation Between Equillium and 2x Corn

Can any of the company-specific risk be diversified away by investing in both Equillium and 2x Corn 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 Equillium and 2x Corn into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Equillium and 2x Corn ETF, you can compare the effects of market volatilities on Equillium and 2x Corn 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 Equillium with a short position of 2x Corn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equillium and 2x Corn.

Diversification Opportunities for Equillium and 2x Corn

0.39

Correlation Coefficient

Equillium  2x Corn

Weak diversification

The 3 months correlation between Equillium and CORX is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Equillium and 2x Corn ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 2x Corn ETF and Equillium 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 Equillium are associated (or correlated) with 2x Corn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 2x Corn ETF has no effect on the direction of Equillium i.e., Equillium and 2x Corn go up and down completely randomly.

Pair Corralation between Equillium and 2x Corn

Allowing for the 90-day total investment horizon Equillium is expected to generate 2.54 times more return on investment than 2x Corn. However, Equillium is 2.54 times more volatile than 2x Corn ETF. It trades about 0.03 of its potential returns per unit of risk. 2x Corn ETF is currently generating about 0.05 per unit of risk. If you would invest  72.00  in Equillium on December 4, 2024 and sell it today you would earn a total of  0.00  from holding Equillium or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Equillium  vs.  2x Corn ETF

Equillium

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Equillium are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Equillium may actually be approaching a critical reversion point that can send shares even higher in April 2025.

2x Corn ETF

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in 2x Corn ETF are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, 2x Corn may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Equillium and 2x Corn

The main advantage of trading using opposite Equillium and 2x Corn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equillium position performs unexpectedly, 2x Corn 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 2x Corn will offset losses from the drop in 2x Corn's long position.

The idea behind Equillium and 2x Corn ETF 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 CEOs Directory module to screen CEOs from public companies around the world.