Correlation Between Immunocore Holdings and Arcellx

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

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

Diversification Opportunities for Immunocore Holdings and Arcellx

-0.27

Correlation Coefficient

Immunocore Holdings  Arcellx

Very good diversification

The 3 months correlation between Immunocore and Arcellx is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Immunocore Holdings and Arcellx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcellx and Immunocore Holdings 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 Immunocore Holdings are associated (or correlated) with Arcellx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcellx has no effect on the direction of Immunocore Holdings i.e., Immunocore Holdings and Arcellx go up and down completely randomly.

Pair Corralation between Immunocore Holdings and Arcellx

Given the investment horizon of 90 days Immunocore Holdings is expected to generate 0.86 times more return on investment than Arcellx. However, Immunocore Holdings is 1.16 times less risky than Arcellx. It trades about 0.02 of its potential returns per unit of risk. Arcellx is currently generating about -0.06 per unit of risk. If you would invest  2,903  in Immunocore Holdings on December 30, 2024 and sell it today you would earn a total of  55.00  from holding Immunocore Holdings or generate 1.89% return on investment over 90 days.

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

Immunocore Holdings  vs.  Arcellx

Immunocore Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Immunocore Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Immunocore Holdings is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Arcellx

Risk-Adjusted Performance

Very Weak

Over the last 90 days Arcellx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's essential indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Immunocore Holdings and Arcellx

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

The idea behind Immunocore Holdings and Arcellx 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.