Correlation Between Sensient Technologies and CalciMedica, Common

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

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

Diversification Opportunities for Sensient Technologies and CalciMedica, Common

-0.03

Correlation Coefficient

Sensient Technologies  CalciMedica, Common

Good diversification

The 3 months correlation between Sensient and CalciMedica, is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and CalciMedica, Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CalciMedica, Common Stock and Sensient Technologies 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 Sensient Technologies are associated (or correlated) with CalciMedica, Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CalciMedica, Common Stock has no effect on the direction of Sensient Technologies i.e., Sensient Technologies and CalciMedica, Common go up and down completely randomly.

Pair Corralation between Sensient Technologies and CalciMedica, Common

Considering the 90-day investment horizon Sensient Technologies is expected to generate 0.4 times more return on investment than CalciMedica, Common. However, Sensient Technologies is 2.52 times less risky than CalciMedica, Common. It trades about 0.01 of its potential returns per unit of risk. CalciMedica, Common Stock is currently generating about -0.1 per unit of risk. If you would invest  7,258  in Sensient Technologies on December 23, 2024 and sell it today you would earn a total of  20.00  from holding Sensient Technologies or generate 0.28% return on investment over 90 days.

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

Sensient Technologies  vs.  CalciMedica, Common Stock

Sensient Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sensient Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Sensient Technologies is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

CalciMedica, Common Stock

Risk-Adjusted Performance

Very Weak

Over the last 90 days CalciMedica, Common Stock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's essential indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Sensient Technologies and CalciMedica, Common

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

The idea behind Sensient Technologies and CalciMedica, Common Stock 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 Global Correlations module to find global opportunities by holding instruments from different markets.