Correlation Between Equillium and Exicure

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

By analyzing existing cross correlation between Equillium and Exicure, you can compare the effects of market volatilities on Equillium and Exicure 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 Exicure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equillium and Exicure.

Diversification Opportunities for Equillium and Exicure

-0.52

Correlation Coefficient

Equillium  Exicure

Excellent diversification

The 3 months correlation between Equillium and Exicure is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Equillium and Exicure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exicure 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 Exicure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exicure has no effect on the direction of Equillium i.e., Equillium and Exicure go up and down completely randomly.

Pair Corralation between Equillium and Exicure

Allowing for the 90-day total investment horizon Equillium is expected to under-perform the Exicure. But the stock apears to be less risky and, when comparing its historical volatility, Equillium is 2.96 times less risky than Exicure. The stock trades about -0.08 of its potential returns per unit of risk. The Exicure is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  257.00  in Exicure on October 22, 2024 and sell it today you would earn a total of  750.00  from holding Exicure or generate 291.83% return on investment over 90 days.

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

Equillium  vs.  Exicure

Equillium

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Equillium has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Exicure

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Exicure are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Exicure reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Equillium and Exicure

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

The idea behind Equillium and Exicure 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.