Correlation Between Immunitybio and Galera Therapeutics

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

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

Diversification Opportunities for Immunitybio and Galera Therapeutics

0.48

Correlation Coefficient

Immunitybio  Galera Therapeutics

Very weak diversification

The 3 months correlation between Immunitybio and Galera is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Immunitybio and Galera Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galera Therapeutics and Immunitybio 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 Immunitybio are associated (or correlated) with Galera Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galera Therapeutics has no effect on the direction of Immunitybio i.e., Immunitybio and Galera Therapeutics go up and down completely randomly.

Pair Corralation between Immunitybio and Galera Therapeutics

Given the investment horizon of 90 days Immunitybio is expected to generate 1.09 times less return on investment than Galera Therapeutics. In addition to that, Immunitybio is 1.77 times more volatile than Galera Therapeutics. It trades about 0.03 of its total potential returns per unit of risk. Galera Therapeutics is currently generating about 0.06 per unit of volatility. If you would invest  211.00  in Galera Therapeutics on October 10, 2024 and sell it today you would earn a total of  47.00  from holding Galera Therapeutics or generate 22.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	26.06%
Values	Daily Returns

Immunitybio  vs.  Galera Therapeutics

Immunitybio

Risk-Adjusted Performance

0 of 100

Very Weak

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

Galera Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Immunitybio and Galera Therapeutics

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

The idea behind Immunitybio and Galera 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.