Correlation Between Humacyte and Surrozen

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

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

Diversification Opportunities for Humacyte and Surrozen

0.47

Correlation Coefficient

Humacyte  Surrozen

Very weak diversification

The 3 months correlation between Humacyte and Surrozen is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Humacyte and Surrozen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surrozen and Humacyte 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 Humacyte are associated (or correlated) with Surrozen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surrozen has no effect on the direction of Humacyte i.e., Humacyte and Surrozen go up and down completely randomly.

Pair Corralation between Humacyte and Surrozen

Assuming the 90 days horizon Humacyte is expected to generate 1.44 times more return on investment than Surrozen. However, Humacyte is 1.44 times more volatile than Surrozen. It trades about 0.06 of its potential returns per unit of risk. Surrozen is currently generating about 0.04 per unit of risk. If you would invest  91.00  in Humacyte on August 31, 2024 and sell it today you would earn a total of  80.00  from holding Humacyte or generate 87.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	92.51%
Values	Daily Returns

Humacyte  vs.  Surrozen

Humacyte

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Humacyte are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Humacyte showed solid returns over the last few months and may actually be approaching a breakup point.

Surrozen

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Surrozen are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Surrozen may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Humacyte and Surrozen

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

The idea behind Humacyte and Surrozen 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 Commodity Directory module to find actively traded commodities issued by global exchanges.