Correlation Between Innate Pharma and Erytech Pharma
Can any of the company-specific risk be diversified away by investing in both Innate Pharma and Erytech Pharma 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 Erytech Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innate Pharma and Erytech Pharma SA, you can compare the effects of market volatilities on Innate Pharma and Erytech Pharma 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 Erytech Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innate Pharma and Erytech Pharma.
Diversification Opportunities for Innate Pharma and Erytech Pharma
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Innate and Erytech is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Innate Pharma and Erytech Pharma SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Erytech Pharma SA 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 Erytech Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Erytech Pharma SA has no effect on the direction of Innate Pharma i.e., Innate Pharma and Erytech Pharma go up and down completely randomly.
Pair Corralation between Innate Pharma and Erytech Pharma
Given the investment horizon of 90 days Innate Pharma is expected to under-perform the Erytech Pharma. In addition to that, Innate Pharma is 1.04 times more volatile than Erytech Pharma SA. It trades about -0.03 of its total potential returns per unit of risk. Erytech Pharma SA is currently generating about -0.03 per unit of volatility. If you would invest 80.00 in Erytech Pharma SA on September 2, 2024 and sell it today you would lose (2.00) from holding Erytech Pharma SA or give up 2.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 3.49% |
| Values | Daily Returns |
Innate Pharma vs. Erytech Pharma SA
Performance |
| Timeline |
| Innate Pharma |
| Erytech Pharma SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Innate Pharma and Erytech Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innate Pharma and Erytech Pharma
The main advantage of trading using opposite Innate Pharma and Erytech Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innate Pharma position performs unexpectedly, Erytech Pharma 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 Erytech Pharma will offset losses from the drop in Erytech Pharma's long position.| Innate Pharma vs. Eliem Therapeutics | Innate Pharma vs. HCW Biologics | Innate Pharma vs. Inhibrx | Innate Pharma vs. Anebulo Pharmaceuticals |
| Erytech Pharma vs. Genfit | Erytech Pharma vs. Eliem Therapeutics | Erytech Pharma vs. HCW Biologics | Erytech Pharma vs. Aptorum Group Ltd |
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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