Correlation Between Molecular Partners and Adicet Bio

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

By analyzing existing cross correlation between Molecular Partners AG and Adicet Bio, you can compare the effects of market volatilities on Molecular Partners and Adicet Bio 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 Molecular Partners with a short position of Adicet Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molecular Partners and Adicet Bio.

Diversification Opportunities for Molecular Partners and Adicet Bio

0.52

Correlation Coefficient

Molecular Partners  Adicet Bio

Very weak diversification

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

Pair Corralation between Molecular Partners and Adicet Bio

Given the investment horizon of 90 days Molecular Partners AG is expected to under-perform the Adicet Bio. In addition to that, Molecular Partners is 1.0 times more volatile than Adicet Bio. It trades about -0.11 of its total potential returns per unit of risk. Adicet Bio is currently generating about -0.04 per unit of volatility. If you would invest  89.00  in Adicet Bio on December 22, 2024 and sell it today you would lose (12.00) from holding Adicet Bio or give up 13.48% of portfolio value over 90 days.

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

Molecular Partners AG  vs.  Adicet Bio

Molecular Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Molecular Partners AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's essential indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Adicet Bio

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adicet Bio has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Molecular Partners and Adicet Bio

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

The idea behind Molecular Partners AG and Adicet Bio 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.