Correlation Between Icosavax and Mirum Pharmaceuticals

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

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

Diversification Opportunities for Icosavax and Mirum Pharmaceuticals

0.0

Correlation Coefficient

Icosavax  Mirum Pharmaceuticals

Pay attention - limited upside

The 3 months correlation between Icosavax and Mirum is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Icosavax and Mirum Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirum Pharmaceuticals and Icosavax 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 Icosavax are associated (or correlated) with Mirum Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirum Pharmaceuticals has no effect on the direction of Icosavax i.e., Icosavax and Mirum Pharmaceuticals go up and down completely randomly.

Pair Corralation between Icosavax and Mirum Pharmaceuticals

If you would invest (100.00) in Icosavax on December 26, 2024 and sell it today you would earn a total of  100.00  from holding Icosavax or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Icosavax  vs.  Mirum Pharmaceuticals

Icosavax

Risk-Adjusted Performance

Very Weak

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

Mirum Pharmaceuticals

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mirum Pharmaceuticals are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Mirum Pharmaceuticals displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Icosavax and Mirum Pharmaceuticals

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

The idea behind Icosavax and Mirum Pharmaceuticals 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.