Correlation Between Iovance Biotherapeutics and Quoin Pharmaceuticals

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

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

Diversification Opportunities for Iovance Biotherapeutics and Quoin Pharmaceuticals

0.21

Correlation Coefficient

Iovance Biotherapeutics  Quoin Pharmaceuticals

Modest diversification

The 3 months correlation between Iovance and Quoin is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Iovance Biotherapeutics and Quoin Pharmaceuticals Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quoin Pharmaceuticals and Iovance Biotherapeutics 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 Iovance Biotherapeutics are associated (or correlated) with Quoin Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quoin Pharmaceuticals has no effect on the direction of Iovance Biotherapeutics i.e., Iovance Biotherapeutics and Quoin Pharmaceuticals go up and down completely randomly.

Pair Corralation between Iovance Biotherapeutics and Quoin Pharmaceuticals

Given the investment horizon of 90 days Iovance Biotherapeutics is expected to under-perform the Quoin Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Iovance Biotherapeutics is 1.88 times less risky than Quoin Pharmaceuticals. The stock trades about -0.13 of its potential returns per unit of risk. The Quoin Pharmaceuticals Ltd is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  62.00  in Quoin Pharmaceuticals Ltd on September 13, 2024 and sell it today you would earn a total of  15.00  from holding Quoin Pharmaceuticals Ltd or generate 24.19% return on investment over 90 days.

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

Iovance Biotherapeutics  vs.  Quoin Pharmaceuticals Ltd

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 uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Quoin Pharmaceuticals

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Quoin Pharmaceuticals Ltd are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Quoin Pharmaceuticals showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Iovance Biotherapeutics and Quoin Pharmaceuticals

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

The idea behind Iovance Biotherapeutics and Quoin Pharmaceuticals Ltd 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.