Correlation Between Sana Biotechnology and TC BioPharm

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

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

Diversification Opportunities for Sana Biotechnology and TC BioPharm

0.44

Correlation Coefficient

Sana Biotechnology  TC BioPharm

Very weak diversification

The 3 months correlation between Sana and TCBPW is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sana Biotechnology and TC BioPharm plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TC BioPharm plc and Sana Biotechnology 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 Sana Biotechnology are associated (or correlated) with TC BioPharm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TC BioPharm plc has no effect on the direction of Sana Biotechnology i.e., Sana Biotechnology and TC BioPharm go up and down completely randomly.

Pair Corralation between Sana Biotechnology and TC BioPharm

Given the investment horizon of 90 days Sana Biotechnology is expected to generate 1.4 times more return on investment than TC BioPharm. However, Sana Biotechnology is 1.4 times more volatile than TC BioPharm plc. It trades about 0.08 of its potential returns per unit of risk. TC BioPharm plc is currently generating about -0.02 per unit of risk. If you would invest  175.00  in Sana Biotechnology on December 24, 2024 and sell it today you would earn a total of  67.00  from holding Sana Biotechnology or generate 38.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Sana Biotechnology  vs.  TC BioPharm plc

Sana Biotechnology

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sana Biotechnology are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sana Biotechnology sustained solid returns over the last few months and may actually be approaching a breakup point.

TC BioPharm plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days TC BioPharm plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Sana Biotechnology and TC BioPharm

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

The idea behind Sana Biotechnology and TC BioPharm plc 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..