Correlation Between Blueprint Medicines and Immuneering Corp

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

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

Diversification Opportunities for Blueprint Medicines and Immuneering Corp

-0.15

Correlation Coefficient

Blueprint Medicines  Immuneering Corp

Good diversification

The 3 months correlation between Blueprint and Immuneering is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Blueprint Medicines Corp and Immuneering Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immuneering Corp and Blueprint Medicines 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 Blueprint Medicines Corp are associated (or correlated) with Immuneering Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immuneering Corp has no effect on the direction of Blueprint Medicines i.e., Blueprint Medicines and Immuneering Corp go up and down completely randomly.

Pair Corralation between Blueprint Medicines and Immuneering Corp

Given the investment horizon of 90 days Blueprint Medicines is expected to generate 17.06 times less return on investment than Immuneering Corp. But when comparing it to its historical volatility, Blueprint Medicines Corp is 4.02 times less risky than Immuneering Corp. It trades about 0.03 of its potential returns per unit of risk. Immuneering Corp is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  121.00  in Immuneering Corp on August 31, 2024 and sell it today you would earn a total of  85.00  from holding Immuneering Corp or generate 70.25% return on investment over 90 days.

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

Blueprint Medicines Corp  vs.  Immuneering Corp

Blueprint Medicines Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Blueprint Medicines Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound primary indicators, Blueprint Medicines is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Immuneering Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Immuneering Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Immuneering Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Blueprint Medicines and Immuneering Corp

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

The idea behind Blueprint Medicines Corp and Immuneering Corp 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.

Check out your portfolio center.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.