Correlation Between CONSOLIDATED and Conduit Pharmaceuticals

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Can any of the company-specific risk be diversified away by investing in both CONSOLIDATED and Conduit 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 CONSOLIDATED and Conduit Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CONSOLIDATED EDISON N and Conduit Pharmaceuticals, you can compare the effects of market volatilities on CONSOLIDATED and Conduit 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 CONSOLIDATED with a short position of Conduit Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of CONSOLIDATED and Conduit Pharmaceuticals.

Diversification Opportunities for CONSOLIDATED and Conduit Pharmaceuticals

-0.47
  Correlation Coefficient

Very good diversification

The 3 months correlation between CONSOLIDATED and Conduit is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding CONSOLIDATED EDISON N and Conduit Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conduit Pharmaceuticals and CONSOLIDATED 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 CONSOLIDATED EDISON N are associated (or correlated) with Conduit Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conduit Pharmaceuticals has no effect on the direction of CONSOLIDATED i.e., CONSOLIDATED and Conduit Pharmaceuticals go up and down completely randomly.

Pair Corralation between CONSOLIDATED and Conduit Pharmaceuticals

Assuming the 90 days trading horizon CONSOLIDATED is expected to generate 14.8 times less return on investment than Conduit Pharmaceuticals. But when comparing it to its historical volatility, CONSOLIDATED EDISON N is 19.05 times less risky than Conduit Pharmaceuticals. It trades about 0.09 of its potential returns per unit of risk. Conduit Pharmaceuticals is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1.30  in Conduit Pharmaceuticals on September 3, 2025 and sell it today you would lose (0.03) from holding Conduit Pharmaceuticals or give up 2.31% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy65.31%
ValuesDaily Returns

CONSOLIDATED EDISON N  vs.  Conduit Pharmaceuticals

 Performance 
       Timeline  
CONSOLIDATED EDISON 

Risk-Adjusted Performance

Mild

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in CONSOLIDATED EDISON N are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, CONSOLIDATED is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Conduit Pharmaceuticals 

Risk-Adjusted Performance

Soft

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Conduit Pharmaceuticals are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Conduit Pharmaceuticals showed solid returns over the last few months and may actually be approaching a breakup point.

CONSOLIDATED and Conduit Pharmaceuticals Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CONSOLIDATED and Conduit Pharmaceuticals

The main advantage of trading using opposite CONSOLIDATED and Conduit Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CONSOLIDATED position performs unexpectedly, Conduit 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 Conduit Pharmaceuticals will offset losses from the drop in Conduit Pharmaceuticals' long position.
The idea behind CONSOLIDATED EDISON N and Conduit 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.

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