Correlation Between ImmuPharma PLC and European Metals
Can any of the company-specific risk be diversified away by investing in both ImmuPharma PLC and European Metals 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 ImmuPharma PLC and European Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ImmuPharma PLC and European Metals Holdings, you can compare the effects of market volatilities on ImmuPharma PLC and European Metals 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 ImmuPharma PLC with a short position of European Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of ImmuPharma PLC and European Metals.
Diversification Opportunities for ImmuPharma PLC and European Metals
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ImmuPharma and European is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding ImmuPharma PLC and European Metals Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on European Metals Holdings and ImmuPharma PLC 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 ImmuPharma PLC are associated (or correlated) with European Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of European Metals Holdings has no effect on the direction of ImmuPharma PLC i.e., ImmuPharma PLC and European Metals go up and down completely randomly.
Pair Corralation between ImmuPharma PLC and European Metals
Assuming the 90 days trading horizon ImmuPharma PLC is expected to generate 1.48 times more return on investment than European Metals. However, ImmuPharma PLC is 1.48 times more volatile than European Metals Holdings. It trades about -0.23 of its potential returns per unit of risk. European Metals Holdings is currently generating about -0.37 per unit of risk. If you would invest 179.00 in ImmuPharma PLC on August 28, 2024 and sell it today you would lose (29.00) from holding ImmuPharma PLC or give up 16.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ImmuPharma PLC vs. European Metals Holdings
Performance |
| Timeline |
| ImmuPharma PLC |
| European Metals Holdings |
ImmuPharma PLC and European Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ImmuPharma PLC and European Metals
The main advantage of trading using opposite ImmuPharma PLC and European Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ImmuPharma PLC position performs unexpectedly, European Metals 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 European Metals will offset losses from the drop in European Metals' long position.| ImmuPharma PLC vs. Samsung Electronics Co | ImmuPharma PLC vs. Samsung Electronics Co | ImmuPharma PLC vs. Hyundai Motor | ImmuPharma PLC vs. Toyota Motor Corp |
| European Metals vs. Givaudan SA | European Metals vs. Antofagasta PLC | European Metals vs. Centamin PLC | European Metals vs. Atalaya Mining |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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