Correlation Between In8bio and INmune Bio

Can any of the company-specific risk be diversified away by investing in both In8bio and INmune Bio 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 In8bio and INmune Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between In8bio Inc and INmune Bio, you can compare the effects of market volatilities on In8bio and INmune Bio 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 In8bio with a short position of INmune Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of In8bio and INmune Bio.

Diversification Opportunities for In8bio and INmune Bio

-0.27

Correlation Coefficient

In8bio  INmune Bio

Very good diversification

The 3 months correlation between In8bio and INmune is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding In8bio Inc and INmune Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INmune Bio and In8bio 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 In8bio Inc are associated (or correlated) with INmune Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INmune Bio has no effect on the direction of In8bio i.e., In8bio and INmune Bio go up and down completely randomly.

Pair Corralation between In8bio and INmune Bio

Given the investment horizon of 90 days In8bio is expected to generate 8.92 times less return on investment than INmune Bio. In addition to that, In8bio is 1.22 times more volatile than INmune Bio. It trades about 0.01 of its total potential returns per unit of risk. INmune Bio is currently generating about 0.15 per unit of volatility. If you would invest  505.00  in INmune Bio on November 29, 2024 and sell it today you would earn a total of  275.00  from holding INmune Bio or generate 54.46% return on investment over 90 days.

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

In8bio Inc  vs.  INmune Bio

In8bio Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in In8bio Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, In8bio may actually be approaching a critical reversion point that can send shares even higher in March 2025.

INmune Bio

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in INmune Bio are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, INmune Bio sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with In8bio and INmune Bio

The main advantage of trading using opposite In8bio and INmune Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if In8bio position performs unexpectedly, INmune Bio 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 INmune Bio will offset losses from the drop in INmune Bio's long position.

The idea behind In8bio Inc and INmune Bio 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.