Correlation Between ImmuPharma PLC and Cars

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

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

Diversification Opportunities for ImmuPharma PLC and Cars

0.0

Correlation Coefficient

ImmuPharma PLC  Cars

Pay attention - limited upside

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

Pair Corralation between ImmuPharma PLC and Cars

Assuming the 90 days trading horizon ImmuPharma PLC is expected to generate 5.43 times more return on investment than Cars. However, ImmuPharma PLC is 5.43 times more volatile than Cars Inc. It trades about 0.14 of its potential returns per unit of risk. Cars Inc is currently generating about -0.24 per unit of risk. If you would invest  117.00  in ImmuPharma PLC on December 22, 2024 and sell it today you would earn a total of  233.00  from holding ImmuPharma PLC or generate 199.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	56.45%
Values	Daily Returns

ImmuPharma PLC  vs.  Cars Inc

ImmuPharma PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ImmuPharma PLC are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, ImmuPharma PLC exhibited solid returns over the last few months and may actually be approaching a breakup point.

Cars Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cars Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with ImmuPharma PLC and Cars

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

The idea behind ImmuPharma PLC and Cars Inc 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.