Correlation Between Cue Biopharma and ANI Pharmaceuticals

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

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

Diversification Opportunities for Cue Biopharma and ANI Pharmaceuticals

-0.18

Correlation Coefficient

Cue Biopharma  ANI Pharmaceuticals

Good diversification

The 3 months correlation between Cue and ANI is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cue Biopharma and ANI Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANI Pharmaceuticals and Cue 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 Cue Biopharma are associated (or correlated) with ANI Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANI Pharmaceuticals has no effect on the direction of Cue Biopharma i.e., Cue Biopharma and ANI Pharmaceuticals go up and down completely randomly.

Pair Corralation between Cue Biopharma and ANI Pharmaceuticals

Considering the 90-day investment horizon Cue Biopharma is expected to under-perform the ANI Pharmaceuticals. In addition to that, Cue Biopharma is 2.13 times more volatile than ANI Pharmaceuticals. It trades about 0.0 of its total potential returns per unit of risk. ANI Pharmaceuticals is currently generating about 0.07 per unit of volatility. If you would invest  2,924  in ANI Pharmaceuticals on February 23, 2024 and sell it today you would earn a total of  3,112  from holding ANI Pharmaceuticals or generate 106.43% return on investment over 90 days.

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

Cue Biopharma  vs.  ANI Pharmaceuticals

Cue Biopharma

Risk-Adjusted Performance

0 of 100

Very Weak

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

ANI Pharmaceuticals

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ANI Pharmaceuticals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable forward indicators, ANI Pharmaceuticals is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Cue Biopharma and ANI Pharmaceuticals

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

The idea behind Cue Biopharma and ANI Pharmaceuticals 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.