Correlation Between Candel Therapeutics and Unicycive Therapeutics

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

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

Diversification Opportunities for Candel Therapeutics and Unicycive Therapeutics

-0.63

Correlation Coefficient

Candel Therapeutics  Unicycive Therapeutics

Excellent diversification

The 3 months correlation between Candel and Unicycive is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Candel Therapeutics and Unicycive Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unicycive Therapeutics and Candel Therapeutics 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 Candel Therapeutics are associated (or correlated) with Unicycive Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unicycive Therapeutics has no effect on the direction of Candel Therapeutics i.e., Candel Therapeutics and Unicycive Therapeutics go up and down completely randomly.

Pair Corralation between Candel Therapeutics and Unicycive Therapeutics

Given the investment horizon of 90 days Candel Therapeutics is expected to under-perform the Unicycive Therapeutics. In addition to that, Candel Therapeutics is 1.05 times more volatile than Unicycive Therapeutics. It trades about -0.06 of its total potential returns per unit of risk. Unicycive Therapeutics is currently generating about 0.36 per unit of volatility. If you would invest  48.00  in Unicycive Therapeutics on September 4, 2024 and sell it today you would earn a total of  26.00  from holding Unicycive Therapeutics or generate 54.17% return on investment over 90 days.

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

Candel Therapeutics  vs.  Unicycive Therapeutics

Candel Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Candel Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Unicycive Therapeutics

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Unicycive Therapeutics are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, Unicycive Therapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Candel Therapeutics and Unicycive Therapeutics

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

The idea behind Candel Therapeutics and Unicycive Therapeutics 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.