Correlation Between Immuneering Corp and Century Therapeutics

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

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

Diversification Opportunities for Immuneering Corp and Century Therapeutics

0.1

Correlation Coefficient

Immuneering Corp  Century Therapeutics

Average diversification

The 3 months correlation between Immuneering and Century is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Immuneering Corp and Century Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Therapeutics and Immuneering Corp 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 Immuneering Corp are associated (or correlated) with Century Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Therapeutics has no effect on the direction of Immuneering Corp i.e., Immuneering Corp and Century Therapeutics go up and down completely randomly.

Pair Corralation between Immuneering Corp and Century Therapeutics

Given the investment horizon of 90 days Immuneering Corp is expected to generate 2.0 times more return on investment than Century Therapeutics. However, Immuneering Corp is 2.0 times more volatile than Century Therapeutics. It trades about 0.13 of its potential returns per unit of risk. Century Therapeutics is currently generating about 0.04 per unit of risk. If you would invest  121.00  in Immuneering Corp on September 2, 2024 and sell it today you would earn a total of  88.00  from holding Immuneering Corp or generate 72.73% return on investment over 90 days.

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

Immuneering Corp  vs.  Century Therapeutics

Immuneering Corp

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Immuneering Corp are ranked lower than 10 (%) 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.

Century Therapeutics

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Century Therapeutics are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Century Therapeutics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Immuneering Corp and Century Therapeutics

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

The idea behind Immuneering Corp and Century Therapeutics 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.