Correlation Between ImmunoGen and Inovio Pharmaceuticals

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

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

Diversification Opportunities for ImmunoGen and Inovio Pharmaceuticals

-0.77

Correlation Coefficient

ImmunoGen  Inovio Pharmaceuticals

Pay attention - limited upside

The 3 months correlation between ImmunoGen and Inovio is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding ImmunoGen and Inovio Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inovio Pharmaceuticals and ImmunoGen 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 ImmunoGen are associated (or correlated) with Inovio Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inovio Pharmaceuticals has no effect on the direction of ImmunoGen i.e., ImmunoGen and Inovio Pharmaceuticals go up and down completely randomly.

Pair Corralation between ImmunoGen and Inovio Pharmaceuticals

Given the investment horizon of 90 days ImmunoGen is expected to generate 2.26 times more return on investment than Inovio Pharmaceuticals. However, ImmunoGen is 2.26 times more volatile than Inovio Pharmaceuticals. It trades about 0.12 of its potential returns per unit of risk. Inovio Pharmaceuticals is currently generating about -0.04 per unit of risk. If you would invest  450.00  in ImmunoGen on September 7, 2024 and sell it today you would earn a total of  1,370  from holding ImmunoGen or generate 304.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	27.46%
Values	Daily Returns

ImmunoGen  vs.  Inovio Pharmaceuticals

ImmunoGen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ImmunoGen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, ImmunoGen is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Inovio Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inovio Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with ImmunoGen and Inovio Pharmaceuticals

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

The idea behind ImmunoGen and Inovio 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.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.