Correlation Between Inhibrx and Arhaus

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

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

Diversification Opportunities for Inhibrx and Arhaus

-0.21

Correlation Coefficient

Inhibrx  Arhaus

Very good diversification

The 3 months correlation between Inhibrx and Arhaus is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Inhibrx and Arhaus Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arhaus Inc and Inhibrx 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 Inhibrx are associated (or correlated) with Arhaus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arhaus Inc has no effect on the direction of Inhibrx i.e., Inhibrx and Arhaus go up and down completely randomly.

Pair Corralation between Inhibrx and Arhaus

Given the investment horizon of 90 days Inhibrx is expected to generate 0.81 times more return on investment than Arhaus. However, Inhibrx is 1.23 times less risky than Arhaus. It trades about 0.01 of its potential returns per unit of risk. Arhaus Inc is currently generating about -0.22 per unit of risk. If you would invest  1,497  in Inhibrx on October 11, 2024 and sell it today you would earn a total of  1.00  from holding Inhibrx or generate 0.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Inhibrx  vs.  Arhaus Inc

Inhibrx

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inhibrx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental drivers, Inhibrx is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Arhaus Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Inhibrx and Arhaus

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

The idea behind Inhibrx and Arhaus 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.

Check out your portfolio center.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .