Correlation Between Abcellera Biologics and Kinder Morgan

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

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

Diversification Opportunities for Abcellera Biologics and Kinder Morgan

0.0

Correlation Coefficient

Abcellera Biologics  Kinder Morgan

Pay attention - limited upside

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

Pair Corralation between Abcellera Biologics and Kinder Morgan

If you would invest (100.00) in Kinder Morgan Energy on March 7, 2024 and sell it today you would earn a total of  100.00  from holding Kinder Morgan Energy or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Abcellera Biologics  vs.  Kinder Morgan Energy

Abcellera Biologics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Abcellera Biologics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in July 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Kinder Morgan Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kinder Morgan Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable primary indicators, Kinder Morgan is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Abcellera Biologics and Kinder Morgan

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

The idea behind Abcellera Biologics and Kinder Morgan Energy 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.