Correlation Between Ginkgo Bioworks and Caribou Biosciences

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

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

Diversification Opportunities for Ginkgo Bioworks and Caribou Biosciences

0.0

Correlation Coefficient

Ginkgo Bioworks  Caribou Biosciences

Pay attention - limited upside

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

Pair Corralation between Ginkgo Bioworks and Caribou Biosciences

Considering the 90-day investment horizon Ginkgo Bioworks Holdings is expected to under-perform the Caribou Biosciences. In addition to that, Ginkgo Bioworks is 1.09 times more volatile than Caribou Biosciences. It trades about -0.03 of its total potential returns per unit of risk. Caribou Biosciences is currently generating about -0.02 per unit of volatility. If you would invest  690.00  in Caribou Biosciences on September 30, 2024 and sell it today you would lose (523.00) from holding Caribou Biosciences or give up 75.8% of portfolio value over 90 days.

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

Ginkgo Bioworks Holdings  vs.  Caribou Biosciences

Ginkgo Bioworks Holdings

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ginkgo Bioworks Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, Ginkgo Bioworks sustained solid returns over the last few months and may actually be approaching a breakup point.

Caribou Biosciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Caribou Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental drivers remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Ginkgo Bioworks and Caribou Biosciences

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

The idea behind Ginkgo Bioworks Holdings and Caribou Biosciences 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.