Correlation Between OSE Pharma and Innate Pharma
Can any of the company-specific risk be diversified away by investing in both OSE Pharma and Innate 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 OSE Pharma and Innate Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSE Pharma SA and Innate Pharma, you can compare the effects of market volatilities on OSE Pharma and Innate 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 OSE Pharma with a short position of Innate Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSE Pharma and Innate Pharma.
Diversification Opportunities for OSE Pharma and Innate Pharma
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OSE and Innate is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding OSE Pharma SA and Innate Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innate Pharma and OSE 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 OSE Pharma SA are associated (or correlated) with Innate Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innate Pharma has no effect on the direction of OSE Pharma i.e., OSE Pharma and Innate Pharma go up and down completely randomly.
Pair Corralation between OSE Pharma and Innate Pharma
Assuming the 90 days trading horizon OSE Pharma SA is expected to generate 1.72 times more return on investment than Innate Pharma. However, OSE Pharma is 1.72 times more volatile than Innate Pharma. It trades about 0.03 of its potential returns per unit of risk. Innate Pharma is currently generating about -0.01 per unit of risk. If you would invest 710.00 in OSE Pharma SA on August 24, 2024 and sell it today you would earn a total of 158.00 from holding OSE Pharma SA or generate 22.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OSE Pharma SA vs. Innate Pharma
Performance |
| Timeline |
| OSE Pharma SA |
| Innate Pharma |
OSE Pharma and Innate Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSE Pharma and Innate Pharma
The main advantage of trading using opposite OSE Pharma and Innate Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSE Pharma position performs unexpectedly, Innate 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 Innate Pharma will offset losses from the drop in Innate Pharma's long position.| OSE Pharma vs. Innate Pharma | OSE Pharma vs. Quantum Genomics SA | OSE Pharma vs. Valneva SE | OSE Pharma vs. Poxel SA |
| Innate Pharma vs. Genfit | Innate Pharma vs. Nanobiotix SA | Innate Pharma vs. Cellectis | Innate Pharma vs. AB Science SA |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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