Correlation Between Equillium and Aditxt

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

Diversification Opportunities for Equillium and Aditxt

-0.2
  Correlation Coefficient

Good diversification

The 3 months correlation between Equillium and Aditxt is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Equillium and Aditxt Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aditxt Inc and Equillium 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 Equillium are associated (or correlated) with Aditxt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aditxt Inc has no effect on the direction of Equillium i.e., Equillium and Aditxt go up and down completely randomly.

Pair Corralation between Equillium and Aditxt

Allowing for the 90-day total investment horizon Equillium is expected to generate 5.06 times more return on investment than Aditxt. However, Equillium is 5.06 times more volatile than Aditxt Inc. It trades about 0.4 of its potential returns per unit of risk. Aditxt Inc is currently generating about -0.22 per unit of risk. If you would invest  87.00  in Equillium on November 28, 2023 and sell it today you would earn a total of  167.00  from holding Equillium or generate 191.95% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.24%
ValuesDaily Returns

Equillium  vs.  Aditxt Inc

 Performance 
       Timeline  
Equillium 

Risk-Adjusted Performance

22 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Equillium are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Equillium reported solid returns over the last few months and may actually be approaching a breakup point.
Aditxt Inc 

Risk-Adjusted Performance

3 of 100

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

Equillium and Aditxt Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Equillium and Aditxt

The main advantage of trading using opposite Equillium and Aditxt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equillium position performs unexpectedly, Aditxt 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 Aditxt will offset losses from the drop in Aditxt's long position.
The idea behind Equillium and Aditxt Inc 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

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