Correlation Between JD Inc and INmune Bio

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Can any of the company-specific risk be diversified away by investing in both JD Inc and INmune Bio 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 JD Inc and INmune Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Inc Adr and INmune Bio, you can compare the effects of market volatilities on JD Inc and INmune Bio 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 JD Inc with a short position of INmune Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Inc and INmune Bio.

Diversification Opportunities for JD Inc and INmune Bio

  Correlation Coefficient

Modest diversification

The 3 months correlation between JD Inc and INmune is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding JD Inc Adr and INmune Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INmune Bio and JD Inc 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 JD Inc Adr are associated (or correlated) with INmune Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INmune Bio has no effect on the direction of JD Inc i.e., JD Inc and INmune Bio go up and down completely randomly.

Pair Corralation between JD Inc and INmune Bio

Allowing for the 90-day total investment horizon JD Inc Adr is expected to generate 1.09 times more return on investment than INmune Bio. However, JD Inc is 1.09 times more volatile than INmune Bio. It trades about 0.02 of its potential returns per unit of risk. INmune Bio is currently generating about -0.02 per unit of risk. If you would invest  5,935  in JD Inc Adr on September 5, 2022 and sell it today you would lose (71.00)  from holding JD Inc Adr or give up 1.2% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
ValuesDaily Returns

JD Inc Adr  vs.  INmune Bio

 Performance (%) 
JD Inc Adr 
JD Inc Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in JD Inc Adr are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, JD Inc is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

JD Inc Price Channel

INmune Bio 
INmune Performance
0 of 100
Over the last 90 days INmune Bio has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, INmune Bio is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

INmune Price Channel

JD Inc and INmune Bio Volatility Contrast

   Predicted Return Density   

Pair Trading with JD Inc and INmune Bio

The main advantage of trading using opposite JD Inc and INmune Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Inc position performs unexpectedly, INmune Bio 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 INmune Bio will offset losses from the drop in INmune Bio's long position.
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The idea behind JD Inc Adr and INmune Bio 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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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.

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