Correlation Between Regenxbio and Bolt Biotherapeutics

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

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

Diversification Opportunities for Regenxbio and Bolt Biotherapeutics

0.37

Correlation Coefficient

Regenxbio  Bolt Biotherapeutics

Weak diversification

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

Pair Corralation between Regenxbio and Bolt Biotherapeutics

Given the investment horizon of 90 days Regenxbio is expected to generate 1.26 times more return on investment than Bolt Biotherapeutics. However, Regenxbio is 1.26 times more volatile than Bolt Biotherapeutics. It trades about 0.04 of its potential returns per unit of risk. Bolt Biotherapeutics is currently generating about -0.05 per unit of risk. If you would invest  787.00  in Regenxbio on December 26, 2024 and sell it today you would earn a total of  34.00  from holding Regenxbio or generate 4.32% return on investment over 90 days.

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

Regenxbio  vs.  Bolt Biotherapeutics

Regenxbio

Risk-Adjusted Performance

Weak

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

Bolt Biotherapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bolt Biotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's essential 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 Regenxbio and Bolt Biotherapeutics

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

The idea behind Regenxbio and Bolt Biotherapeutics 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.