Correlation Between Foghorn Therapeutics and GlycoMimetics

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Foghorn Therapeutics and GlycoMimetics 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 Foghorn Therapeutics and GlycoMimetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foghorn Therapeutics and GlycoMimetics, you can compare the effects of market volatilities on Foghorn Therapeutics and GlycoMimetics 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 Foghorn Therapeutics with a short position of GlycoMimetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foghorn Therapeutics and GlycoMimetics.

Diversification Opportunities for Foghorn Therapeutics and GlycoMimetics

FoghornGlycoMimeticsDiversified AwayFoghornGlycoMimeticsDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Foghorn Therapeutics and GlycoMimetics

Given the investment horizon of 90 days Foghorn Therapeutics is expected to under-perform the GlycoMimetics. But the stock apears to be less risky and, when comparing its historical volatility, Foghorn Therapeutics is 5.53 times less risky than GlycoMimetics. The stock trades about -0.17 of its potential returns per unit of risk. The GlycoMimetics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  16.00  in GlycoMimetics on September 18, 2024 and sell it today you would earn a total of  7.31  from holding GlycoMimetics or generate 45.69% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Foghorn Therapeutics  vs.  GlycoMimetics

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 050100150200
JavaScript chart by amCharts 3.21.15FHTX GLYC
       Timeline  
Foghorn Therapeutics 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Foghorn Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec5678910
GlycoMimetics 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in GlycoMimetics are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, GlycoMimetics exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec0.20.30.40.50.6

Foghorn Therapeutics and GlycoMimetics Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.69-5.76-3.83-1.9-0.02711.63.24.826.458.08 0.0050.0100.0150.020
JavaScript chart by amCharts 3.21.15FHTX GLYC
       Returns  

Pair Trading with Foghorn Therapeutics and GlycoMimetics

The main advantage of trading using opposite Foghorn Therapeutics and GlycoMimetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foghorn Therapeutics position performs unexpectedly, GlycoMimetics 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 GlycoMimetics will offset losses from the drop in GlycoMimetics' long position.
The idea behind Foghorn Therapeutics and GlycoMimetics 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

Other Complementary Tools

Transaction History
View history of all your transactions and understand their impact on performance
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments