Correlation Between High Yield and Willow Biosciences

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

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

Diversification Opportunities for High Yield and Willow Biosciences

-0.52

Correlation Coefficient

High Yield  Willow Biosciences

Excellent diversification

The 3 months correlation between High and Willow is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Municipal Fund and Willow Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willow Biosciences and High Yield 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 High Yield Municipal Fund are associated (or correlated) with Willow Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willow Biosciences has no effect on the direction of High Yield i.e., High Yield and Willow Biosciences go up and down completely randomly.

Pair Corralation between High Yield and Willow Biosciences

Assuming the 90 days horizon High Yield is expected to generate 21.06 times less return on investment than Willow Biosciences. But when comparing it to its historical volatility, High Yield Municipal Fund is 74.17 times less risky than Willow Biosciences. It trades about 0.16 of its potential returns per unit of risk. Willow Biosciences is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  12.00  in Willow Biosciences on October 8, 2025 and sell it today you would earn a total of  0.00  from holding Willow Biosciences or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	60.66%
Values	Daily Returns

High Yield Municipal Fund  vs.  Willow Biosciences

High Yield Municipal

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in High Yield Municipal Fund are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, High Yield is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Willow Biosciences

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Willow Biosciences are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Willow Biosciences reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with High Yield and Willow Biosciences

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

The idea behind High Yield Municipal Fund and Willow 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.