Correlation Between Immunovant and Stoke Therapeutics
Can any of the company-specific risk be diversified away by investing in both Immunovant and Stoke Therapeutics 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 Immunovant and Stoke Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Immunovant and Stoke Therapeutics, you can compare the effects of market volatilities on Immunovant and Stoke Therapeutics 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 Immunovant with a short position of Stoke Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Immunovant and Stoke Therapeutics.
Diversification Opportunities for Immunovant and Stoke Therapeutics
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Immunovant and Stoke is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Immunovant and Stoke Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stoke Therapeutics and Immunovant 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 Immunovant are associated (or correlated) with Stoke Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stoke Therapeutics has no effect on the direction of Immunovant i.e., Immunovant and Stoke Therapeutics go up and down completely randomly.
Pair Corralation between Immunovant and Stoke Therapeutics
Given the investment horizon of 90 days Immunovant is expected to generate 0.94 times more return on investment than Stoke Therapeutics. However, Immunovant is 1.06 times less risky than Stoke Therapeutics. It trades about 0.03 of its potential returns per unit of risk. Stoke Therapeutics is currently generating about 0.03 per unit of risk. If you would invest 2,125 in Immunovant on August 31, 2024 and sell it today you would earn a total of 695.00 from holding Immunovant or generate 32.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Immunovant vs. Stoke Therapeutics
Performance |
| Timeline |
| Immunovant |
| Stoke Therapeutics |
Immunovant and Stoke Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Immunovant and Stoke Therapeutics
The main advantage of trading using opposite Immunovant and Stoke Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Immunovant position performs unexpectedly, Stoke Therapeutics 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 Stoke Therapeutics will offset losses from the drop in Stoke Therapeutics' long position.| Immunovant vs. Arbutus Biopharma Corp | Immunovant vs. Arcutis Biotherapeutics | Immunovant vs. Legend Biotech Corp | Immunovant vs. Protagonist Therapeutics |
| Stoke Therapeutics vs. Adaptimmune Therapeutics Plc | Stoke Therapeutics vs. Black Diamond Therapeutics | Stoke Therapeutics vs. Relay Therapeutics | Stoke Therapeutics vs. Pliant 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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