Correlation Between Alphabet and Cytek Biosciences

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

By analyzing existing cross correlation between Alphabet Inc Class C and Cytek Biosciences, you can compare the effects of market volatilities on Alphabet and Cytek 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 Alphabet with a short position of Cytek Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and Cytek Biosciences.

Diversification Opportunities for Alphabet and Cytek Biosciences

-0.18

Correlation Coefficient

Alphabet  Cytek Biosciences

Good diversification

The 3 months correlation between Alphabet and Cytek is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C and Cytek Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytek Biosciences and Alphabet 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 Alphabet Inc Class C are associated (or correlated) with Cytek Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytek Biosciences has no effect on the direction of Alphabet i.e., Alphabet and Cytek Biosciences go up and down completely randomly.

Pair Corralation between Alphabet and Cytek Biosciences

Given the investment horizon of 90 days Alphabet Inc Class C is expected to generate 0.34 times more return on investment than Cytek Biosciences. However, Alphabet Inc Class C is 2.96 times less risky than Cytek Biosciences. It trades about 0.16 of its potential returns per unit of risk. Cytek Biosciences is currently generating about -0.02 per unit of risk. If you would invest  16,365  in Alphabet Inc Class C on April 25, 2025 and sell it today you would earn a total of  2,786  from holding Alphabet Inc Class C or generate 17.02% return on investment over 90 days.

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

Alphabet Inc Class C  vs.  Cytek Biosciences

Alphabet Class C

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alphabet Inc Class C are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, Alphabet reported solid returns over the last few months and may actually be approaching a breakup point.

Cytek Biosciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cytek Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's forward-looking signals remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Alphabet and Cytek Biosciences

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

The idea behind Alphabet Inc Class C and Cytek 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.