Correlation Between Dominari Holdings and Immatics

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

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

Diversification Opportunities for Dominari Holdings and Immatics

-0.81

Correlation Coefficient

Dominari Holdings  Immatics

Pay attention - limited upside

The 3 months correlation between Dominari and Immatics is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Dominari Holdings and Immatics NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immatics NV and Dominari Holdings 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 Dominari Holdings are associated (or correlated) with Immatics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immatics NV has no effect on the direction of Dominari Holdings i.e., Dominari Holdings and Immatics go up and down completely randomly.

Pair Corralation between Dominari Holdings and Immatics

Given the investment horizon of 90 days Dominari Holdings is expected to generate 2.6 times more return on investment than Immatics. However, Dominari Holdings is 2.6 times more volatile than Immatics NV. It trades about 0.21 of its potential returns per unit of risk. Immatics NV is currently generating about -0.21 per unit of risk. If you would invest  217.00  in Dominari Holdings on January 25, 2024 and sell it today you would earn a total of  59.00  from holding Dominari Holdings or generate 27.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Dominari Holdings  vs.  Immatics NV

Dominari Holdings

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dominari Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak primary indicators, Dominari Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Immatics NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immatics NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Dominari Holdings and Immatics

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

The idea behind Dominari Holdings and Immatics NV 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.