Correlation Between Axsome Therapeutics and Immunic

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

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

Diversification Opportunities for Axsome Therapeutics and Immunic

-0.35

Correlation Coefficient

Axsome Therapeutics  Immunic

Very good diversification

The 3 months correlation between Axsome and Immunic is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Axsome Therapeutics and Immunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immunic and Axsome Therapeutics 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 Axsome Therapeutics are associated (or correlated) with Immunic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immunic has no effect on the direction of Axsome Therapeutics i.e., Axsome Therapeutics and Immunic go up and down completely randomly.

Pair Corralation between Axsome Therapeutics and Immunic

Given the investment horizon of 90 days Axsome Therapeutics is expected to under-perform the Immunic. But the stock apears to be less risky and, when comparing its historical volatility, Axsome Therapeutics is 2.51 times less risky than Immunic. The stock trades about -0.03 of its potential returns per unit of risk. The Immunic is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  107.00  in Immunic on September 17, 2024 and sell it today you would earn a total of  4.00  from holding Immunic or generate 3.74% return on investment over 90 days.

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

Axsome Therapeutics  vs.  Immunic

Axsome Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

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

Immunic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immunic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Axsome Therapeutics and Immunic

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

The idea behind Axsome Therapeutics and Immunic 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.