Correlation Between Inhibrx and Transgene

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

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

Diversification Opportunities for Inhibrx and Transgene

0.0

Correlation Coefficient

Inhibrx  Transgene

Pay attention - limited upside

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

Pair Corralation between Inhibrx and Transgene

Given the investment horizon of 90 days Inhibrx is expected to under-perform the Transgene. In addition to that, Inhibrx is 2.61 times more volatile than Transgene SA. It trades about -0.01 of its total potential returns per unit of risk. Transgene SA is currently generating about 0.01 per unit of volatility. If you would invest  162.00  in Transgene SA on September 4, 2024 and sell it today you would lose (3.00) from holding Transgene SA or give up 1.85% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Inhibrx  vs.  Transgene SA

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.

Transgene SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Transgene SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Transgene is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Inhibrx and Transgene

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

The idea behind Inhibrx and Transgene SA 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.