Correlation Between Agilent Technologies and Bolt Biotherapeutics

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

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

Diversification Opportunities for Agilent Technologies and Bolt Biotherapeutics

0.8

Correlation Coefficient

Agilent Technologies  Bolt Biotherapeutics

Very poor diversification

The 3 months correlation between Agilent and Bolt is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Bolt Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bolt Biotherapeutics and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Bolt Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bolt Biotherapeutics has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Bolt Biotherapeutics go up and down completely randomly.

Pair Corralation between Agilent Technologies and Bolt Biotherapeutics

Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 0.49 times more return on investment than Bolt Biotherapeutics. However, Agilent Technologies is 2.04 times less risky than Bolt Biotherapeutics. It trades about -0.2 of its potential returns per unit of risk. Bolt Biotherapeutics is currently generating about -0.1 per unit of risk. If you would invest  14,831  in Agilent Technologies on February 3, 2025 and sell it today you would lose (3,968) from holding Agilent Technologies or give up 26.75% of portfolio value over 90 days.

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

Agilent Technologies  vs.  Bolt Biotherapeutics

Agilent Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Agilent Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in June 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Bolt Biotherapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bolt Biotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in June 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Agilent Technologies and Bolt Biotherapeutics

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

The idea behind Agilent Technologies and Bolt Biotherapeutics 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.