Correlation Between Yield10 Bioscience and Intrepid Potash

Can any of the company-specific risk be diversified away by investing in both Yield10 Bioscience and Intrepid Potash 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 Yield10 Bioscience and Intrepid Potash into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Yield10 Bioscience and Intrepid Potash, you can compare the effects of market volatilities on Yield10 Bioscience and Intrepid Potash 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 Yield10 Bioscience with a short position of Intrepid Potash. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yield10 Bioscience and Intrepid Potash.

Diversification Opportunities for Yield10 Bioscience and Intrepid Potash

-0.83

Correlation Coefficient

Yield10 Bioscience  Intrepid Potash

Pay attention - limited upside

The 3 months correlation between Yield10 and Intrepid is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Yield10 Bioscience and Intrepid Potash in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrepid Potash and Yield10 Bioscience 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 Yield10 Bioscience are associated (or correlated) with Intrepid Potash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrepid Potash has no effect on the direction of Yield10 Bioscience i.e., Yield10 Bioscience and Intrepid Potash go up and down completely randomly.

Pair Corralation between Yield10 Bioscience and Intrepid Potash

If you would invest  2,423  in Intrepid Potash on September 16, 2024 and sell it today you would earn a total of  93.00  from holding Intrepid Potash or generate 3.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.54%
Values	Daily Returns

Yield10 Bioscience  vs.  Intrepid Potash

Yield10 Bioscience

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yield10 Bioscience has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Yield10 Bioscience is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Intrepid Potash

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Intrepid Potash are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Intrepid Potash is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Yield10 Bioscience and Intrepid Potash

The main advantage of trading using opposite Yield10 Bioscience and Intrepid Potash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yield10 Bioscience position performs unexpectedly, Intrepid Potash 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 Intrepid Potash will offset losses from the drop in Intrepid Potash's long position.

The idea behind Yield10 Bioscience and Intrepid Potash 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.