Correlation Between Incyte and Imunon

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

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

Diversification Opportunities for Incyte and Imunon

-0.29

Correlation Coefficient

Incyte  Imunon

Very good diversification

The 3 months correlation between Incyte and Imunon is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Incyte and Imunon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imunon Inc and Incyte 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 Incyte are associated (or correlated) with Imunon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imunon Inc has no effect on the direction of Incyte i.e., Incyte and Imunon go up and down completely randomly.

Pair Corralation between Incyte and Imunon

Given the investment horizon of 90 days Incyte is expected to generate 4.78 times less return on investment than Imunon. But when comparing it to its historical volatility, Incyte is 3.33 times less risky than Imunon. It trades about 0.18 of its potential returns per unit of risk. Imunon Inc is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  79.00  in Imunon Inc on October 26, 2024 and sell it today you would earn a total of  21.00  from holding Imunon Inc or generate 26.58% return on investment over 90 days.

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

Incyte  vs.  Imunon Inc

Incyte

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Incyte are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, Incyte showed solid returns over the last few months and may actually be approaching a breakup point.

Imunon Inc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Imunon Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Imunon is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Incyte and Imunon

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

The idea behind Incyte and Imunon 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.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.