Correlation Between Jd ComInc and INmune Bio

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Can any of the company-specific risk be diversified away by investing in both Jd ComInc 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 ComInc 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 ComInc and INmune Bio, you can compare the effects of market volatilities on Jd ComInc 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 ComInc with a short position of INmune Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jd ComInc and INmune Bio.

Diversification Opportunities for Jd ComInc and INmune Bio

0.26
  Correlation Coefficient

Modest diversification

The 3 months correlation between JDCMF and INmune is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Jd ComInc and INmune Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INmune Bio and Jd ComInc 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 ComInc 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 ComInc i.e., Jd ComInc and INmune Bio go up and down completely randomly.

Pair Corralation between Jd ComInc and INmune Bio

Assuming the 90 days horizon Jd ComInc is expected to generate 3.11 times less return on investment than INmune Bio. But when comparing it to its historical volatility, Jd ComInc is 1.33 times less risky than INmune Bio. It trades about 0.01 of its potential returns per unit of risk. INmune Bio is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  917.00  in INmune Bio on September 3, 2022 and sell it today you would lose (227.50)  from holding INmune Bio or give up 24.81% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy99.6%
ValuesDaily Returns

Jd ComInc  vs.  INmune Bio

 Performance (%) 
       Timeline  
Jd ComInc 
JDCMF Performance
0 of 100
Over the last 90 days Jd ComInc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Jd ComInc is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

JDCMF 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 latest stock price disturbance, may contribute to short-term losses for the investors.

INmune Price Channel

Jd ComInc and INmune Bio Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jd ComInc and INmune Bio

The main advantage of trading using opposite Jd ComInc and INmune Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jd ComInc 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 ComInc 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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