Correlation Between Design Therapeutics and Acumen Pharmaceuticals

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

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

Diversification Opportunities for Design Therapeutics and Acumen Pharmaceuticals

0.2

Correlation Coefficient

Design Therapeutics  Acumen Pharmaceuticals

Modest diversification

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

Pair Corralation between Design Therapeutics and Acumen Pharmaceuticals

Given the investment horizon of 90 days Design Therapeutics is expected to generate 1.0 times more return on investment than Acumen Pharmaceuticals. However, Design Therapeutics is 1.0 times more volatile than Acumen Pharmaceuticals. It trades about 0.22 of its potential returns per unit of risk. Acumen Pharmaceuticals is currently generating about 0.15 per unit of risk. If you would invest  354.00  in Design Therapeutics on July 4, 2025 and sell it today you would earn a total of  325.00  from holding Design Therapeutics or generate 91.81% return on investment over 90 days.

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

Design Therapeutics  vs.  Acumen Pharmaceuticals

Design Therapeutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Design Therapeutics are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Design Therapeutics displayed solid returns over the last few months and may actually be approaching a breakup point.

Acumen Pharmaceuticals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Acumen Pharmaceuticals are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Acumen Pharmaceuticals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Design Therapeutics and Acumen Pharmaceuticals

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

The idea behind Design Therapeutics and Acumen Pharmaceuticals 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.