Correlation Between Opthea and Immunocore Holdings

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

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

Diversification Opportunities for Opthea and Immunocore Holdings

-0.15

Correlation Coefficient

Opthea  Immunocore Holdings

Good diversification

The 3 months correlation between Opthea and Immunocore is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Opthea and Immunocore Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immunocore Holdings and Opthea 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 Opthea are associated (or correlated) with Immunocore Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immunocore Holdings has no effect on the direction of Opthea i.e., Opthea and Immunocore Holdings go up and down completely randomly.

Pair Corralation between Opthea and Immunocore Holdings

Considering the 90-day investment horizon Opthea is expected to generate 13.29 times less return on investment than Immunocore Holdings. In addition to that, Opthea is 2.58 times more volatile than Immunocore Holdings. It trades about 0.0 of its total potential returns per unit of risk. Immunocore Holdings is currently generating about 0.02 per unit of volatility. If you would invest  2,903  in Immunocore Holdings on December 30, 2024 and sell it today you would earn a total of  55.00  from holding Immunocore Holdings or generate 1.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.48%
Values	Daily Returns

Opthea  vs.  Immunocore Holdings

Opthea

Risk-Adjusted Performance

Very Weak

Over the last 90 days Opthea has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Opthea is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Immunocore Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Immunocore Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Immunocore Holdings is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Opthea and Immunocore Holdings

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

The idea behind Opthea and Immunocore Holdings 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..