Correlation Between Inovio Pharmaceuticals and CytomX Therapeutics
Can any of the company-specific risk be diversified away by investing in both Inovio Pharmaceuticals and CytomX 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 Inovio Pharmaceuticals and CytomX Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inovio Pharmaceuticals and CytomX Therapeutics, you can compare the effects of market volatilities on Inovio Pharmaceuticals and CytomX 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 Inovio Pharmaceuticals with a short position of CytomX Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inovio Pharmaceuticals and CytomX Therapeutics.
Diversification Opportunities for Inovio Pharmaceuticals and CytomX Therapeutics
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inovio and CytomX is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Inovio Pharmaceuticals and CytomX Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CytomX Therapeutics and Inovio Pharmaceuticals 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 Inovio Pharmaceuticals are associated (or correlated) with CytomX Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CytomX Therapeutics has no effect on the direction of Inovio Pharmaceuticals i.e., Inovio Pharmaceuticals and CytomX Therapeutics go up and down completely randomly.
Pair Corralation between Inovio Pharmaceuticals and CytomX Therapeutics
Considering the 90-day investment horizon Inovio Pharmaceuticals is expected to under-perform the CytomX Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Inovio Pharmaceuticals is 1.97 times less risky than CytomX Therapeutics. The stock trades about -0.03 of its potential returns per unit of risk. The CytomX Therapeutics is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 164.00 in CytomX Therapeutics on September 4, 2024 and sell it today you would lose (55.00) from holding CytomX Therapeutics or give up 33.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inovio Pharmaceuticals vs. CytomX Therapeutics
Performance |
| Timeline |
| Inovio Pharmaceuticals |
| CytomX Therapeutics |
Inovio Pharmaceuticals and CytomX Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inovio Pharmaceuticals and CytomX Therapeutics
The main advantage of trading using opposite Inovio Pharmaceuticals and CytomX Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inovio Pharmaceuticals position performs unexpectedly, CytomX 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 CytomX Therapeutics will offset losses from the drop in CytomX Therapeutics' long position.| Inovio Pharmaceuticals vs. Novavax | Inovio Pharmaceuticals vs. Vaxart Inc | Inovio Pharmaceuticals vs. Enveric Biosciences | Inovio Pharmaceuticals vs. Ocean Biomedical |
| CytomX Therapeutics vs. Candel Therapeutics | CytomX Therapeutics vs. Cingulate Warrants | CytomX Therapeutics vs. Unicycive Therapeutics | CytomX Therapeutics vs. Cardio Diagnostics Holdings |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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