Correlation Between Vaccinex and Cyclacel Pharmaceuticals

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

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

Diversification Opportunities for Vaccinex and Cyclacel Pharmaceuticals

-0.41

Correlation Coefficient

Vaccinex  Cyclacel Pharmaceuticals

Very good diversification

The 3 months correlation between Vaccinex and Cyclacel is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Vaccinex and Cyclacel Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cyclacel Pharmaceuticals and Vaccinex 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 Vaccinex are associated (or correlated) with Cyclacel Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cyclacel Pharmaceuticals has no effect on the direction of Vaccinex i.e., Vaccinex and Cyclacel Pharmaceuticals go up and down completely randomly.

Pair Corralation between Vaccinex and Cyclacel Pharmaceuticals

Given the investment horizon of 90 days Vaccinex is expected to under-perform the Cyclacel Pharmaceuticals. In addition to that, Vaccinex is 3.31 times more volatile than Cyclacel Pharmaceuticals. It trades about -0.3 of its total potential returns per unit of risk. Cyclacel Pharmaceuticals is currently generating about 0.28 per unit of volatility. If you would invest  645.00  in Cyclacel Pharmaceuticals on October 8, 2024 and sell it today you would earn a total of  195.00  from holding Cyclacel Pharmaceuticals or generate 30.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.95%
Values	Daily Returns

Vaccinex  vs.  Cyclacel Pharmaceuticals

Vaccinex

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vaccinex has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, Vaccinex showed solid returns over the last few months and may actually be approaching a breakup point.

Cyclacel Pharmaceuticals

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cyclacel Pharmaceuticals are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent fundamental indicators, Cyclacel Pharmaceuticals reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vaccinex and Cyclacel Pharmaceuticals

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

The idea behind Vaccinex and Cyclacel Pharmaceuticals 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 Commodity Directory module to find actively traded commodities issued by global exchanges.