Correlation Between Pulmatrix and Cybin

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

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

Diversification Opportunities for Pulmatrix and Cybin

0.37

Correlation Coefficient

Pulmatrix  Cybin

Weak diversification

The 3 months correlation between Pulmatrix and Cybin is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Pulmatrix and Cybin Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cybin Inc and Pulmatrix 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 Pulmatrix are associated (or correlated) with Cybin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cybin Inc has no effect on the direction of Pulmatrix i.e., Pulmatrix and Cybin go up and down completely randomly.

Pair Corralation between Pulmatrix and Cybin

Given the investment horizon of 90 days Pulmatrix is expected to generate 2.45 times more return on investment than Cybin. However, Pulmatrix is 2.45 times more volatile than Cybin Inc. It trades about 0.2 of its potential returns per unit of risk. Cybin Inc is currently generating about 0.12 per unit of risk. If you would invest  179.00  in Pulmatrix on September 12, 2024 and sell it today you would earn a total of  412.00  from holding Pulmatrix or generate 230.17% return on investment over 90 days.

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

Pulmatrix  vs.  Cybin Inc

Pulmatrix

Risk-Adjusted Performance

15 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pulmatrix are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very weak essential indicators, Pulmatrix displayed solid returns over the last few months and may actually be approaching a breakup point.

Cybin Inc

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cybin Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady fundamental drivers, Cybin displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pulmatrix and Cybin

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

The idea behind Pulmatrix and Cybin Inc 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.

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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.