Correlation Between Adicet Bio and Fortress Biotech

Can any of the company-specific risk be diversified away by investing in both Adicet Bio and Fortress Biotech 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 Adicet Bio and Fortress Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Adicet Bio and Fortress Biotech

0.32

Correlation Coefficient

Adicet Bio  Fortress Biotech

Weak diversification

The 3 months correlation between Adicet and Fortress is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Adicet Bio and Fortress Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Biotech and Adicet Bio 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 Adicet Bio are associated (or correlated) with Fortress Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Biotech has no effect on the direction of Adicet Bio i.e., Adicet Bio and Fortress Biotech go up and down completely randomly.

Pair Corralation between Adicet Bio and Fortress Biotech

Given the investment horizon of 90 days Adicet Bio is expected to generate 2.63 times less return on investment than Fortress Biotech. But when comparing it to its historical volatility, Adicet Bio is 1.27 times less risky than Fortress Biotech. It trades about 0.04 of its potential returns per unit of risk. Fortress Biotech is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  212.00  in Fortress Biotech on August 15, 2025 and sell it today you would earn a total of  50.00  from holding Fortress Biotech or generate 23.58% return on investment over 90 days.

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

Adicet Bio  vs.  Fortress Biotech

Adicet Bio

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Adicet Bio are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Adicet Bio unveiled solid returns over the last few months and may actually be approaching a breakup point.

Fortress Biotech

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Fortress Biotech are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain forward indicators, Fortress Biotech displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Adicet Bio and Fortress Biotech

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

The idea behind Adicet Bio and Fortress Biotech 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..