Correlation Between Anixa Biosciences and Iovance Biotherapeutics

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

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

Diversification Opportunities for Anixa Biosciences and Iovance Biotherapeutics

0.62

Correlation Coefficient

Anixa Biosciences  Iovance Biotherapeutics

Poor diversification

The 3 months correlation between Anixa and Iovance is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Anixa Biosciences and Iovance Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iovance Biotherapeutics and Anixa Biosciences 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 Anixa Biosciences are associated (or correlated) with Iovance Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iovance Biotherapeutics has no effect on the direction of Anixa Biosciences i.e., Anixa Biosciences and Iovance Biotherapeutics go up and down completely randomly.

Pair Corralation between Anixa Biosciences and Iovance Biotherapeutics

Given the investment horizon of 90 days Anixa Biosciences is expected to generate 0.99 times more return on investment than Iovance Biotherapeutics. However, Anixa Biosciences is 1.01 times less risky than Iovance Biotherapeutics. It trades about 0.01 of its potential returns per unit of risk. Iovance Biotherapeutics is currently generating about -0.04 per unit of risk. If you would invest  323.00  in Anixa Biosciences on September 3, 2024 and sell it today you would lose (9.00) from holding Anixa Biosciences or give up 2.79% of portfolio value over 90 days.

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

Anixa Biosciences  vs.  Iovance Biotherapeutics

Anixa Biosciences

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Anixa Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward indicators, Anixa Biosciences is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Iovance Biotherapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Iovance Biotherapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Anixa Biosciences and Iovance Biotherapeutics

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

The idea behind Anixa Biosciences and Iovance Biotherapeutics 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.