Correlation Between PepGen and Candel Therapeutics

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

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

Diversification Opportunities for PepGen and Candel Therapeutics

-0.54

Correlation Coefficient

PepGen  Candel Therapeutics

Excellent diversification

The 3 months correlation between PepGen and Candel is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding PepGen and Candel Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candel Therapeutics and PepGen 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 PepGen are associated (or correlated) with Candel Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Candel Therapeutics has no effect on the direction of PepGen i.e., PepGen and Candel Therapeutics go up and down completely randomly.

Pair Corralation between PepGen and Candel Therapeutics

Given the investment horizon of 90 days PepGen is expected to under-perform the Candel Therapeutics. In addition to that, PepGen is 1.02 times more volatile than Candel Therapeutics. It trades about -0.02 of its total potential returns per unit of risk. Candel Therapeutics is currently generating about 0.14 per unit of volatility. If you would invest  457.00  in Candel Therapeutics on December 2, 2024 and sell it today you would earn a total of  441.00  from holding Candel Therapeutics or generate 96.5% return on investment over 90 days.

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

PepGen  vs.  Candel Therapeutics

PepGen

Risk-Adjusted Performance

Very Weak

Over the last 90 days PepGen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Candel Therapeutics

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Candel Therapeutics are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady fundamental indicators, Candel Therapeutics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PepGen and Candel Therapeutics

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

The idea behind PepGen and Candel Therapeutics 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.