Correlation Between ImmuCell and Aldeyra
Can any of the company-specific risk be diversified away by investing in both ImmuCell and Aldeyra 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 ImmuCell and Aldeyra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ImmuCell and Aldeyra, you can compare the effects of market volatilities on ImmuCell and Aldeyra 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 ImmuCell with a short position of Aldeyra. Check out your portfolio center. Please also check ongoing floating volatility patterns of ImmuCell and Aldeyra.
Diversification Opportunities for ImmuCell and Aldeyra
Modest diversification
The 3 months correlation between ImmuCell and Aldeyra is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding ImmuCell and Aldeyra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aldeyra and ImmuCell 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 ImmuCell are associated (or correlated) with Aldeyra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aldeyra has no effect on the direction of ImmuCell i.e., ImmuCell and Aldeyra go up and down completely randomly.
Pair Corralation between ImmuCell and Aldeyra
Given the investment horizon of 90 days ImmuCell is expected to under-perform the Aldeyra. But the stock apears to be less risky and, when comparing its historical volatility, ImmuCell is 2.2 times less risky than Aldeyra. The stock trades about -0.03 of its potential returns per unit of risk. The Aldeyra is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 614.00 in Aldeyra on August 30, 2024 and sell it today you would lose (120.00) from holding Aldeyra or give up 19.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
ImmuCell vs. Aldeyra
Performance |
| Timeline |
| ImmuCell |
| Aldeyra |
ImmuCell and Aldeyra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ImmuCell and Aldeyra
The main advantage of trading using opposite ImmuCell and Aldeyra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ImmuCell position performs unexpectedly, Aldeyra 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 Aldeyra will offset losses from the drop in Aldeyra's long position.| ImmuCell vs. Transgene SA | ImmuCell vs. Alpha Cognition | ImmuCell vs. Fennec Pharmaceuticals | ImmuCell vs. Lipella Pharmaceuticals Common |
| Aldeyra vs. Tarsus Pharmaceuticals | Aldeyra vs. Travere Therapeutics | Aldeyra vs. Eton Pharmaceuticals | Aldeyra vs. Viridian Therapeutics |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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