Correlation Between Triumph and Infinity Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Triumph and Infinity 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 Triumph and Infinity Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triumph Group and Infinity Pharmaceuticals, you can compare the effects of market volatilities on Triumph and Infinity 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 Triumph with a short position of Infinity Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triumph and Infinity Pharmaceuticals.
Diversification Opportunities for Triumph and Infinity Pharmaceuticals
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Triumph and Infinity is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Triumph Group and Infinity Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infinity Pharmaceuticals and Triumph 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 Triumph Group are associated (or correlated) with Infinity Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infinity Pharmaceuticals has no effect on the direction of Triumph i.e., Triumph and Infinity Pharmaceuticals go up and down completely randomly.
Pair Corralation between Triumph and Infinity Pharmaceuticals
If you would invest 4.00 in Infinity Pharmaceuticals on January 19, 2024 and sell it today you would earn a total of 0.00 from holding Infinity Pharmaceuticals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Triumph Group vs. Infinity Pharmaceuticals
Performance |
| Timeline |
| Triumph Group |
| Infinity Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Triumph and Infinity Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triumph and Infinity Pharmaceuticals
The main advantage of trading using opposite Triumph and Infinity Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triumph position performs unexpectedly, Infinity 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 Infinity Pharmaceuticals will offset losses from the drop in Infinity Pharmaceuticals' long position.The idea behind Triumph Group and Infinity Pharmaceuticals 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.| Infinity Pharmaceuticals vs. NextCure | Infinity Pharmaceuticals vs. Chimerix | Infinity Pharmaceuticals vs. Eledon Pharmaceuticals | Infinity Pharmaceuticals vs. CytomX Therapeutics |
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 the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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