Correlation Between Inhibrx and SunOpta

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

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

Diversification Opportunities for Inhibrx and SunOpta

-0.51

Correlation Coefficient

Inhibrx  SunOpta

Excellent diversification

The 3 months correlation between Inhibrx and SunOpta is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Inhibrx and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta 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 SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Inhibrx i.e., Inhibrx and SunOpta go up and down completely randomly.

Pair Corralation between Inhibrx and SunOpta

Given the investment horizon of 90 days Inhibrx is expected to under-perform the SunOpta. In addition to that, Inhibrx is 1.03 times more volatile than SunOpta. It trades about -0.07 of its total potential returns per unit of risk. SunOpta is currently generating about 0.25 per unit of volatility. If you would invest  598.00  in SunOpta on September 26, 2024 and sell it today you would earn a total of  185.00  from holding SunOpta or generate 30.94% return on investment over 90 days.

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

Inhibrx  vs.  SunOpta

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 latest stock price disturbance, may contribute to short-term losses for the investors.

SunOpta

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SunOpta are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward-looking signals, SunOpta disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inhibrx and SunOpta

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

The idea behind Inhibrx and SunOpta 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.