Correlation Between Kinnate Biopharma and Caribou Biosciences

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

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

Diversification Opportunities for Kinnate Biopharma and Caribou Biosciences

0.52

Correlation Coefficient

Kinnate Biopharma  Caribou Biosciences

Very weak diversification

The 3 months correlation between Kinnate and Caribou is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Kinnate Biopharma and Caribou Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caribou Biosciences and Kinnate Biopharma 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 Kinnate Biopharma 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 Kinnate Biopharma i.e., Kinnate Biopharma and Caribou Biosciences go up and down completely randomly.

Pair Corralation between Kinnate Biopharma and Caribou Biosciences

If you would invest  296.00  in Kinnate Biopharma on September 28, 2024 and sell it today you would earn a total of  0.00  from holding Kinnate Biopharma or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	5.0%
Values	Daily Returns

Kinnate Biopharma  vs.  Caribou Biosciences

Kinnate Biopharma

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kinnate Biopharma has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Kinnate Biopharma is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

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 Kinnate Biopharma and Caribou Biosciences

The main advantage of trading using opposite Kinnate Biopharma and Caribou Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinnate Biopharma 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 Kinnate Biopharma 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.