Correlation Between Apellis Pharmaceuticals and Immunome

Can any of the company-specific risk be diversified away by investing in both Apellis Pharmaceuticals and Immunome 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 Apellis Pharmaceuticals and Immunome into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apellis Pharmaceuticals and Immunome, you can compare the effects of market volatilities on Apellis Pharmaceuticals and Immunome 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 Apellis Pharmaceuticals with a short position of Immunome. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apellis Pharmaceuticals and Immunome.

Diversification Opportunities for Apellis Pharmaceuticals and Immunome

0.68

Correlation Coefficient

Apellis Pharmaceuticals  Immunome

Poor diversification

The 3 months correlation between Apellis and Immunome is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Apellis Pharmaceuticals and Immunome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immunome and Apellis Pharmaceuticals 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 Apellis Pharmaceuticals are associated (or correlated) with Immunome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immunome has no effect on the direction of Apellis Pharmaceuticals i.e., Apellis Pharmaceuticals and Immunome go up and down completely randomly.

Pair Corralation between Apellis Pharmaceuticals and Immunome

Given the investment horizon of 90 days Apellis Pharmaceuticals is expected to under-perform the Immunome. But the stock apears to be less risky and, when comparing its historical volatility, Apellis Pharmaceuticals is 1.33 times less risky than Immunome. The stock trades about -0.01 of its potential returns per unit of risk. The Immunome is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,471  in Immunome on September 4, 2024 and sell it today you would lose (63.00) from holding Immunome or give up 4.28% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Apellis Pharmaceuticals  vs.  Immunome

Apellis Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apellis Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Apellis Pharmaceuticals is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Immunome

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immunome has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Immunome is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Apellis Pharmaceuticals and Immunome

The main advantage of trading using opposite Apellis Pharmaceuticals and Immunome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apellis Pharmaceuticals position performs unexpectedly, Immunome 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 Immunome will offset losses from the drop in Immunome's long position.

The idea behind Apellis Pharmaceuticals and Immunome pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.