Correlation Between Instil Bio and Aligos Therapeutics

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

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

Diversification Opportunities for Instil Bio and Aligos Therapeutics

0.22

Correlation Coefficient

Instil Bio  Aligos Therapeutics

Modest diversification

The 3 months correlation between Instil and Aligos is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Instil Bio and Aligos Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aligos Therapeutics and Instil Bio 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 Instil Bio are associated (or correlated) with Aligos Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aligos Therapeutics has no effect on the direction of Instil Bio i.e., Instil Bio and Aligos Therapeutics go up and down completely randomly.

Pair Corralation between Instil Bio and Aligos Therapeutics

Considering the 90-day investment horizon Instil Bio is expected to generate 1.0 times more return on investment than Aligos Therapeutics. However, Instil Bio is 1.0 times less risky than Aligos Therapeutics. It trades about -0.01 of its potential returns per unit of risk. Aligos Therapeutics is currently generating about -0.25 per unit of risk. If you would invest  2,172  in Instil Bio on December 21, 2024 and sell it today you would lose (383.00) from holding Instil Bio or give up 17.63% of portfolio value over 90 days.

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

Instil Bio  vs.  Aligos Therapeutics

Instil Bio

Risk-Adjusted Performance

Very Weak

Over the last 90 days Instil Bio has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward indicators, Instil Bio is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Aligos Therapeutics

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Instil Bio and Aligos Therapeutics

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

The idea behind Instil Bio and Aligos Therapeutics 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.