Correlation Between Burning Rock and Indaptus Therapeutics

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Can any of the company-specific risk be diversified away by investing in both Burning Rock and Indaptus Therapeutics 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 Burning Rock and Indaptus Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burning Rock Biotech and Indaptus Therapeutics, you can compare the effects of market volatilities on Burning Rock and Indaptus Therapeutics 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 Burning Rock with a short position of Indaptus Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burning Rock and Indaptus Therapeutics.

Diversification Opportunities for Burning Rock and Indaptus Therapeutics

-0.78
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Burning and Indaptus is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Burning Rock Biotech and Indaptus Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indaptus Therapeutics and Burning Rock 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 Burning Rock Biotech are associated (or correlated) with Indaptus Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indaptus Therapeutics has no effect on the direction of Burning Rock i.e., Burning Rock and Indaptus Therapeutics go up and down completely randomly.

Pair Corralation between Burning Rock and Indaptus Therapeutics

Considering the 90-day investment horizon Burning Rock Biotech is expected to under-perform the Indaptus Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Burning Rock Biotech is 1.06 times less risky than Indaptus Therapeutics. The stock trades about -0.03 of its potential returns per unit of risk. The Indaptus Therapeutics is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  165.00  in Indaptus Therapeutics on October 5, 2024 and sell it today you would lose (79.52) from holding Indaptus Therapeutics or give up 48.19% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Burning Rock Biotech  vs.  Indaptus Therapeutics

 Performance 
       Timeline  
Burning Rock Biotech 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Burning Rock Biotech are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Burning Rock reported solid returns over the last few months and may actually be approaching a breakup point.
Indaptus Therapeutics 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Indaptus Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Burning Rock and Indaptus Therapeutics Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Burning Rock and Indaptus Therapeutics

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

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