Correlation Between Gain Therapeutics and Immutep

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

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

Diversification Opportunities for Gain Therapeutics and Immutep

0.19

Correlation Coefficient

Gain Therapeutics  Immutep

Average diversification

The 3 months correlation between Gain and Immutep is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Gain Therapeutics and Immutep Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immutep Ltd ADR and Gain 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 Gain Therapeutics are associated (or correlated) with Immutep. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immutep Ltd ADR has no effect on the direction of Gain Therapeutics i.e., Gain Therapeutics and Immutep go up and down completely randomly.

Pair Corralation between Gain Therapeutics and Immutep

Given the investment horizon of 90 days Gain Therapeutics is expected to generate 2.43 times more return on investment than Immutep. However, Gain Therapeutics is 2.43 times more volatile than Immutep Ltd ADR. It trades about -0.02 of its potential returns per unit of risk. Immutep Ltd ADR is currently generating about -0.07 per unit of risk. If you would invest  218.00  in Gain Therapeutics on December 28, 2024 and sell it today you would lose (29.00) from holding Gain Therapeutics or give up 13.3% of portfolio value over 90 days.

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

Gain Therapeutics  vs.  Immutep Ltd ADR

Gain Therapeutics

Risk-Adjusted Performance

Very Weak

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

Immutep Ltd ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Immutep Ltd ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's primary indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Gain Therapeutics and Immutep

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

The idea behind Gain Therapeutics and Immutep Ltd ADR 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.