Correlation Between Pact Group and Imugene

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

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

Diversification Opportunities for Pact Group and Imugene

0.48

Correlation Coefficient

Pact Group  Imugene

Very weak diversification

The 3 months correlation between Pact and Imugene is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Pact Group Holdings and Imugene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imugene and Pact Group 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 Pact Group Holdings are associated (or correlated) with Imugene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imugene has no effect on the direction of Pact Group i.e., Pact Group and Imugene go up and down completely randomly.

Pair Corralation between Pact Group and Imugene

Assuming the 90 days trading horizon Pact Group is expected to generate 12.67 times less return on investment than Imugene. But when comparing it to its historical volatility, Pact Group Holdings is 3.6 times less risky than Imugene. It trades about 0.0 of its potential returns per unit of risk. Imugene is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  3.90  in Imugene on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Imugene or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.0%
Values	Daily Returns

Pact Group Holdings  vs.  Imugene

Pact Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Imugene

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Imugene has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Pact Group and Imugene

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

The idea behind Pact Group Holdings and Imugene 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..