Correlation Between Instil Bio and Graphite Bio

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

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

Diversification Opportunities for Instil Bio and Graphite Bio

0.0

Correlation Coefficient

Instil Bio  Graphite Bio

Pay attention - limited upside

The 3 months correlation between Instil and Graphite is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Instil Bio and Graphite Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graphite Bio and Instil Bio 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 Instil Bio are associated (or correlated) with Graphite Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graphite Bio has no effect on the direction of Instil Bio i.e., Instil Bio and Graphite Bio go up and down completely randomly.

Pair Corralation between Instil Bio and Graphite Bio

If you would invest  1,899  in Instil Bio on December 29, 2024 and sell it today you would earn a total of  37.00  from holding Instil Bio or generate 1.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Instil Bio  vs.  Graphite Bio

Instil Bio

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Instil Bio are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward indicators, Instil Bio disclosed solid returns over the last few months and may actually be approaching a breakup point.

Graphite Bio

Risk-Adjusted Performance

Very Weak

Over the last 90 days Graphite Bio has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Graphite Bio is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Instil Bio and Graphite Bio

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

The idea behind Instil Bio and Graphite Bio 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.