Correlation Between NGM Biopharmaceutica and Bolt Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both NGM Biopharmaceutica and Bolt Biotherapeutics 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 NGM Biopharmaceutica and Bolt Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NGM Biopharmaceuticals and Bolt Biotherapeutics, you can compare the effects of market volatilities on NGM Biopharmaceutica and Bolt Biotherapeutics 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 NGM Biopharmaceutica with a short position of Bolt Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NGM Biopharmaceutica and Bolt Biotherapeutics.
Diversification Opportunities for NGM Biopharmaceutica and Bolt Biotherapeutics
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NGM and Bolt is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding NGM Biopharmaceuticals and Bolt Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bolt Biotherapeutics and NGM Biopharmaceutica 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 NGM Biopharmaceuticals are associated (or correlated) with Bolt Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bolt Biotherapeutics has no effect on the direction of NGM Biopharmaceutica i.e., NGM Biopharmaceutica and Bolt Biotherapeutics go up and down completely randomly.
Pair Corralation between NGM Biopharmaceutica and Bolt Biotherapeutics
If you would invest 250.00 in NGM Biopharmaceuticals on July 21, 2024 and sell it today you would earn a total of 0.00 from holding NGM Biopharmaceuticals or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 1.54% |
Values | Daily Returns |
NGM Biopharmaceuticals vs. Bolt Biotherapeutics
Performance |
Timeline |
NGM Biopharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bolt Biotherapeutics |
NGM Biopharmaceutica and Bolt Biotherapeutics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with NGM Biopharmaceutica and Bolt Biotherapeutics
The main advantage of trading using opposite NGM Biopharmaceutica and Bolt Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NGM Biopharmaceutica position performs unexpectedly, Bolt Biotherapeutics 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 Bolt Biotherapeutics will offset losses from the drop in Bolt Biotherapeutics' long position.NGM Biopharmaceutica vs. Instil Bio | NGM Biopharmaceutica vs. Achilles Therapeutics PLC | NGM Biopharmaceutica vs. NextCure | NGM Biopharmaceutica vs. Assembly Biosciences |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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