Correlation Between Alto Metals and Imugene

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

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

Diversification Opportunities for Alto Metals and Imugene

-0.71

Correlation Coefficient

Alto Metals  Imugene

Pay attention - limited upside

The 3 months correlation between Alto and Imugene is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Alto Metals and Imugene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imugene and Alto Metals 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 Alto Metals 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 Alto Metals i.e., Alto Metals and Imugene go up and down completely randomly.

Pair Corralation between Alto Metals and Imugene

Assuming the 90 days trading horizon Alto Metals is expected to generate 0.85 times more return on investment than Imugene. However, Alto Metals is 1.18 times less risky than Imugene. It trades about 0.18 of its potential returns per unit of risk. Imugene is currently generating about -0.22 per unit of risk. If you would invest  6.60  in Alto Metals on September 2, 2024 and sell it today you would earn a total of  2.60  from holding Alto Metals or generate 39.39% return on investment over 90 days.

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

Alto Metals  vs.  Imugene

Alto Metals

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alto Metals are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Alto Metals unveiled solid returns over the last few months and may actually be approaching a breakup point.

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 January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Alto Metals and Imugene

The main advantage of trading using opposite Alto Metals and Imugene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alto Metals 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 Alto Metals 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.