Correlation Between Imugene and Greenvale Energy

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

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

Diversification Opportunities for Imugene and Greenvale Energy

-0.74

Correlation Coefficient

Imugene  Greenvale Energy

Pay attention - limited upside

The 3 months correlation between Imugene and Greenvale is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Imugene and Greenvale Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenvale Energy and Imugene 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 Imugene are associated (or correlated) with Greenvale Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenvale Energy has no effect on the direction of Imugene i.e., Imugene and Greenvale Energy go up and down completely randomly.

Pair Corralation between Imugene and Greenvale Energy

Assuming the 90 days trading horizon Imugene is expected to generate 1.17 times more return on investment than Greenvale Energy. However, Imugene is 1.17 times more volatile than Greenvale Energy. It trades about 0.22 of its potential returns per unit of risk. Greenvale Energy is currently generating about 0.11 per unit of risk. If you would invest  3.70  in Imugene on October 16, 2024 and sell it today you would earn a total of  0.60  from holding Imugene or generate 16.22% return on investment over 90 days.

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

Imugene  vs.  Greenvale Energy

Imugene

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Imugene has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Greenvale Energy

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Greenvale Energy are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Greenvale Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Imugene and Greenvale Energy

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

The idea behind Imugene and Greenvale Energy 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.