Correlation Between Passage Bio and Inhibrx
Can any of the company-specific risk be diversified away by investing in both Passage Bio and Inhibrx 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 Passage Bio and Inhibrx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Passage Bio and Inhibrx, you can compare the effects of market volatilities on Passage Bio and Inhibrx 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 Passage Bio with a short position of Inhibrx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Passage Bio and Inhibrx.
Diversification Opportunities for Passage Bio and Inhibrx
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Passage and Inhibrx is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Passage Bio and Inhibrx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inhibrx and Passage Bio 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 Passage Bio are associated (or correlated) with Inhibrx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inhibrx has no effect on the direction of Passage Bio i.e., Passage Bio and Inhibrx go up and down completely randomly.
Pair Corralation between Passage Bio and Inhibrx
Given the investment horizon of 90 days Passage Bio is expected to under-perform the Inhibrx. But the stock apears to be less risky and, when comparing its historical volatility, Passage Bio is 1.31 times less risky than Inhibrx. The stock trades about -0.5 of its potential returns per unit of risk. The Inhibrx is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 1,525 in Inhibrx on November 2, 2024 and sell it today you would lose (170.00) from holding Inhibrx or give up 11.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Passage Bio vs. Inhibrx
Performance |
| Timeline |
| Passage Bio |
| Inhibrx |
Passage Bio and Inhibrx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Passage Bio and Inhibrx
The main advantage of trading using opposite Passage Bio and Inhibrx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Passage Bio position performs unexpectedly, Inhibrx 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 Inhibrx will offset losses from the drop in Inhibrx's long position.| Passage Bio vs. Black Diamond Therapeutics | Passage Bio vs. Revolution Medicines | Passage Bio vs. Stoke Therapeutics | Passage Bio vs. Cabaletta Bio |
| Inhibrx vs. Crinetics Pharmaceuticals | Inhibrx vs. Merus BV | Inhibrx vs. Lyell Immunopharma | Inhibrx vs. Kronos Bio |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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