Correlation Between Yum Brands and Infinity Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Yum Brands and Infinity Pharmaceuticals 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 Yum Brands and Infinity Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yum Brands and Infinity Pharmaceuticals, you can compare the effects of market volatilities on Yum Brands and Infinity Pharmaceuticals 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 Yum Brands with a short position of Infinity Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yum Brands and Infinity Pharmaceuticals.
Diversification Opportunities for Yum Brands and Infinity Pharmaceuticals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Yum and Infinity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Yum Brands and Infinity Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infinity Pharmaceuticals and Yum Brands 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 Yum Brands are associated (or correlated) with Infinity Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infinity Pharmaceuticals has no effect on the direction of Yum Brands i.e., Yum Brands and Infinity Pharmaceuticals go up and down completely randomly.
Pair Corralation between Yum Brands and Infinity Pharmaceuticals
Considering the 90-day investment horizon Yum Brands is expected to generate 124.39 times less return on investment than Infinity Pharmaceuticals. But when comparing it to its historical volatility, Yum Brands is 72.46 times less risky than Infinity Pharmaceuticals. It trades about 0.05 of its potential returns per unit of risk. Infinity Pharmaceuticals is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 0.25 in Infinity Pharmaceuticals on September 4, 2024 and sell it today you would lose (0.24) from holding Infinity Pharmaceuticals or give up 96.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yum Brands vs. Infinity Pharmaceuticals
Performance |
| Timeline |
| Yum Brands |
| Infinity Pharmaceuticals |
Yum Brands and Infinity Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yum Brands and Infinity Pharmaceuticals
The main advantage of trading using opposite Yum Brands and Infinity Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yum Brands position performs unexpectedly, Infinity Pharmaceuticals 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 Infinity Pharmaceuticals will offset losses from the drop in Infinity Pharmaceuticals' long position.| Yum Brands vs. Hyatt Hotels | Yum Brands vs. Smart Share Global | Yum Brands vs. Sweetgreen | Yum Brands vs. Wyndham Hotels Resorts |
| Infinity Pharmaceuticals vs. Yum Brands | Infinity Pharmaceuticals vs. Shake Shack | Infinity Pharmaceuticals vs. BJs Restaurants | Infinity Pharmaceuticals vs. Kura Sushi USA |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |