Correlation Between Affimed NV and Inovio Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Affimed NV and Inovio 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 Affimed NV and Inovio Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affimed NV and Inovio Pharmaceuticals, you can compare the effects of market volatilities on Affimed NV and Inovio 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 Affimed NV with a short position of Inovio Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affimed NV and Inovio Pharmaceuticals.
Diversification Opportunities for Affimed NV and Inovio Pharmaceuticals
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Affimed and Inovio is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Affimed NV and Inovio Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inovio Pharmaceuticals and Affimed NV 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 Affimed NV are associated (or correlated) with Inovio Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inovio Pharmaceuticals has no effect on the direction of Affimed NV i.e., Affimed NV and Inovio Pharmaceuticals go up and down completely randomly.
Pair Corralation between Affimed NV and Inovio Pharmaceuticals
Given the investment horizon of 90 days Affimed NV is expected to under-perform the Inovio Pharmaceuticals. In addition to that, Affimed NV is 1.08 times more volatile than Inovio Pharmaceuticals. It trades about -0.04 of its total potential returns per unit of risk. Inovio Pharmaceuticals is currently generating about -0.03 per unit of volatility. If you would invest 2,076 in Inovio Pharmaceuticals on August 30, 2024 and sell it today you would lose (1,657) from holding Inovio Pharmaceuticals or give up 79.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affimed NV vs. Inovio Pharmaceuticals
Performance |
| Timeline |
| Affimed NV |
| Inovio Pharmaceuticals |
Affimed NV and Inovio Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affimed NV and Inovio Pharmaceuticals
The main advantage of trading using opposite Affimed NV and Inovio Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affimed NV position performs unexpectedly, Inovio 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 Inovio Pharmaceuticals will offset losses from the drop in Inovio Pharmaceuticals' long position.| Affimed NV vs. Bright Minds Biosciences | Affimed NV vs. HP Inc | Affimed NV vs. Intel | Affimed NV vs. Chevron Corp |
| Inovio Pharmaceuticals vs. Novavax | Inovio Pharmaceuticals vs. Vaxart Inc | Inovio Pharmaceuticals vs. Enveric Biosciences | Inovio Pharmaceuticals vs. Ocean Biomedical |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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