Correlation Between Structure Therapeutics and Immunocore Holdings

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

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

Diversification Opportunities for Structure Therapeutics and Immunocore Holdings

-0.27

Correlation Coefficient

Structure Therapeutics  Immunocore Holdings

Very good diversification

The 3 months correlation between Structure and Immunocore is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Structure Therapeutics America and Immunocore Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immunocore Holdings and Structure Therapeutics 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 Structure Therapeutics American are associated (or correlated) with Immunocore Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immunocore Holdings has no effect on the direction of Structure Therapeutics i.e., Structure Therapeutics and Immunocore Holdings go up and down completely randomly.

Pair Corralation between Structure Therapeutics and Immunocore Holdings

Given the investment horizon of 90 days Structure Therapeutics American is expected to under-perform the Immunocore Holdings. In addition to that, Structure Therapeutics is 1.74 times more volatile than Immunocore Holdings. It trades about -0.03 of its total potential returns per unit of risk. Immunocore Holdings is currently generating about -0.05 per unit of volatility. If you would invest  3,608  in Immunocore Holdings on September 2, 2024 and sell it today you would lose (334.00) from holding Immunocore Holdings or give up 9.26% of portfolio value over 90 days.

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

Structure Therapeutics America  vs.  Immunocore Holdings

Structure Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Structure Therapeutics American has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unfluctuating performance, the Stock's fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Immunocore Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immunocore Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Structure Therapeutics and Immunocore Holdings

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

The idea behind Structure Therapeutics American and Immunocore Holdings 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.