Correlation Between Innate Pharma and Biocardia
Can any of the company-specific risk be diversified away by investing in both Innate Pharma and Biocardia 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 Innate Pharma and Biocardia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innate Pharma and Biocardia, you can compare the effects of market volatilities on Innate Pharma and Biocardia 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 Innate Pharma with a short position of Biocardia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innate Pharma and Biocardia.
Diversification Opportunities for Innate Pharma and Biocardia
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Innate and Biocardia is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Innate Pharma and Biocardia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biocardia and Innate Pharma 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 Innate Pharma are associated (or correlated) with Biocardia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biocardia has no effect on the direction of Innate Pharma i.e., Innate Pharma and Biocardia go up and down completely randomly.
Pair Corralation between Innate Pharma and Biocardia
Given the investment horizon of 90 days Innate Pharma is expected to generate 1.49 times more return on investment than Biocardia. However, Innate Pharma is 1.49 times more volatile than Biocardia. It trades about 0.17 of its potential returns per unit of risk. Biocardia is currently generating about -0.08 per unit of risk. If you would invest 180.00 in Innate Pharma on November 28, 2024 and sell it today you would earn a total of 40.00 from holding Innate Pharma or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innate Pharma vs. Biocardia
Performance |
| Timeline |
| Innate Pharma |
| Biocardia |
Innate Pharma and Biocardia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innate Pharma and Biocardia
The main advantage of trading using opposite Innate Pharma and Biocardia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innate Pharma position performs unexpectedly, Biocardia 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 Biocardia will offset losses from the drop in Biocardia's long position.| Innate Pharma vs. HCW Biologics | Innate Pharma vs. Inhibrx | Innate Pharma vs. Anebulo Pharmaceuticals | Innate Pharma vs. Shattuck Labs |
| Biocardia vs. Aerovate Therapeutics | Biocardia vs. Adagene | Biocardia vs. Acrivon Therapeutics, Common | Biocardia vs. Rezolute |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |