Correlation Between C4 Therapeutics and Instil Bio

Can any of the company-specific risk be diversified away by investing in both C4 Therapeutics and Instil Bio 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 C4 Therapeutics and Instil Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between C4 Therapeutics and Instil Bio, you can compare the effects of market volatilities on C4 Therapeutics and Instil Bio 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 C4 Therapeutics with a short position of Instil Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of C4 Therapeutics and Instil Bio.

Diversification Opportunities for C4 Therapeutics and Instil Bio

-0.05

Correlation Coefficient

C4 Therapeutics  Instil Bio

Good diversification

The 3 months correlation between CCCC and Instil is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding C4 Therapeutics and Instil Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Instil Bio and C4 Therapeutics 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 C4 Therapeutics are associated (or correlated) with Instil Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Instil Bio has no effect on the direction of C4 Therapeutics i.e., C4 Therapeutics and Instil Bio go up and down completely randomly.

Pair Corralation between C4 Therapeutics and Instil Bio

Given the investment horizon of 90 days C4 Therapeutics is expected to generate 1.31 times less return on investment than Instil Bio. But when comparing it to its historical volatility, C4 Therapeutics is 1.42 times less risky than Instil Bio. It trades about 0.15 of its potential returns per unit of risk. Instil Bio is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,644  in Instil Bio on May 20, 2025 and sell it today you would earn a total of  1,242  from holding Instil Bio or generate 75.55% return on investment over 90 days.

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

C4 Therapeutics  vs.  Instil Bio

C4 Therapeutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in C4 Therapeutics are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, C4 Therapeutics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Instil Bio

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Instil Bio are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward indicators, Instil Bio disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with C4 Therapeutics and Instil Bio

The main advantage of trading using opposite C4 Therapeutics and Instil Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C4 Therapeutics position performs unexpectedly, Instil Bio 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 Instil Bio will offset losses from the drop in Instil Bio's long position.

The idea behind C4 Therapeutics and Instil Bio 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.