Correlation Between Intellia Therapeutics and Catalyst Pharmaceuticals

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

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

Diversification Opportunities for Intellia Therapeutics and Catalyst Pharmaceuticals

0.21

Correlation Coefficient

Intellia Therapeutics  Catalyst Pharmaceuticals

Modest diversification

The 3 months correlation between Intellia and Catalyst is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Intellia Therapeutics and Catalyst Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Pharmaceuticals and Intellia 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 Intellia Therapeutics are associated (or correlated) with Catalyst Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Pharmaceuticals has no effect on the direction of Intellia Therapeutics i.e., Intellia Therapeutics and Catalyst Pharmaceuticals go up and down completely randomly.

Pair Corralation between Intellia Therapeutics and Catalyst Pharmaceuticals

Given the investment horizon of 90 days Intellia Therapeutics is expected to generate 2.66 times more return on investment than Catalyst Pharmaceuticals. However, Intellia Therapeutics is 2.66 times more volatile than Catalyst Pharmaceuticals. It trades about 0.21 of its potential returns per unit of risk. Catalyst Pharmaceuticals is currently generating about 0.01 per unit of risk. If you would invest  1,250  in Intellia Therapeutics on July 29, 2025 and sell it today you would earn a total of  1,310  from holding Intellia Therapeutics or generate 104.8% return on investment over 90 days.

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

Intellia Therapeutics  vs.  Catalyst Pharmaceuticals

Intellia Therapeutics

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Intellia Therapeutics are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating essential indicators, Intellia Therapeutics sustained solid returns over the last few months and may actually be approaching a breakup point.

Catalyst Pharmaceuticals

Risk-Adjusted Performance

Weakest

Over the last 90 days Catalyst Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Catalyst Pharmaceuticals is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Intellia Therapeutics and Catalyst Pharmaceuticals

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

The idea behind Intellia Therapeutics and Catalyst 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.