Correlation Between Quantum Si and Annexon

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

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

Diversification Opportunities for Quantum Si and Annexon

-0.45

Correlation Coefficient

Quantum Si  Annexon

Very good diversification

The 3 months correlation between Quantum and Annexon is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Quantum Si incorporated and Annexon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Annexon and Quantum Si 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 Quantum Si incorporated are associated (or correlated) with Annexon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Annexon has no effect on the direction of Quantum Si i.e., Quantum Si and Annexon go up and down completely randomly.

Pair Corralation between Quantum Si and Annexon

Assuming the 90 days horizon Quantum Si incorporated is expected to generate 42.49 times more return on investment than Annexon. However, Quantum Si is 42.49 times more volatile than Annexon. It trades about 0.14 of its potential returns per unit of risk. Annexon is currently generating about -0.01 per unit of risk. If you would invest  15.00  in Quantum Si incorporated on July 1, 2024 and sell it today you would lose (6.27) from holding Quantum Si incorporated or give up 41.8% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.02%
Values	Daily Returns

Quantum Si incorporated  vs.  Annexon

Quantum Si incorporated

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Quantum Si incorporated are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Quantum Si showed solid returns over the last few months and may actually be approaching a breakup point.

Annexon

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Annexon are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Annexon showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Quantum Si and Annexon

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

The idea behind Quantum Si incorporated and Annexon 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.

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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.