Correlation Between Awakn Life and ImmuCell

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

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

Diversification Opportunities for Awakn Life and ImmuCell

-0.11

Correlation Coefficient

Awakn Life  ImmuCell

Good diversification

The 3 months correlation between Awakn and ImmuCell is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Awakn Life Sciences and ImmuCell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ImmuCell and Awakn Life 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 Awakn Life Sciences are associated (or correlated) with ImmuCell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ImmuCell has no effect on the direction of Awakn Life i.e., Awakn Life and ImmuCell go up and down completely randomly.

Pair Corralation between Awakn Life and ImmuCell

Assuming the 90 days horizon Awakn Life Sciences is expected to generate 2.87 times more return on investment than ImmuCell. However, Awakn Life is 2.87 times more volatile than ImmuCell. It trades about 0.06 of its potential returns per unit of risk. ImmuCell is currently generating about 0.14 per unit of risk. If you would invest  7.59  in Awakn Life Sciences on September 14, 2024 and sell it today you would earn a total of  0.38  from holding Awakn Life Sciences or generate 5.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Awakn Life Sciences  vs.  ImmuCell

Awakn Life Sciences

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Awakn Life Sciences are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Awakn Life reported solid returns over the last few months and may actually be approaching a breakup point.

ImmuCell

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ImmuCell are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, ImmuCell exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Awakn Life and ImmuCell

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

The idea behind Awakn Life Sciences and ImmuCell 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.