Correlation Between Infinity Pharmaceuti and Berkeley Lights

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

Diversification Opportunities for Infinity Pharmaceuti and Berkeley Lights

0.87
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Infinity and Berkeley is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Infinity Pharmaceuti and Berkeley Lights in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkeley Lights and Infinity Pharmaceuti 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 Infinity Pharmaceuti are associated (or correlated) with Berkeley Lights. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkeley Lights has no effect on the direction of Infinity Pharmaceuti i.e., Infinity Pharmaceuti and Berkeley Lights go up and down completely randomly.

Pair Corralation between Infinity Pharmaceuti and Berkeley Lights

Given the investment horizon of 90 days Infinity Pharmaceuti is expected to under-perform the Berkeley Lights. In addition to that, Infinity Pharmaceuti is 1.03 times more volatile than Berkeley Lights. It trades about -0.02 of its total potential returns per unit of risk. Berkeley Lights is currently generating about 0.09 per unit of volatility. If you would invest  502.00  in Berkeley Lights on April 3, 2022 and sell it today you would earn a total of  44.00  from holding Berkeley Lights or generate 8.76% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Infinity Pharmaceuti  vs.  Berkeley Lights

 Performance (%) 
      Timeline 
Infinity Pharmaceuti 
Infinity Performance
0 of 100
Over the last 90 days Infinity Pharmaceuti has generated negative risk-adjusted returns adding no value to investors with long positions. Despite sluggish performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in August 2022. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Structure and Payout Changes

Last Split Factor
1:4
Last Split Date
2006-09-13

Infinity Price Channel

Berkeley Lights 
Berkeley Performance
0 of 100
Over the last 90 days Berkeley Lights has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's essential indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Berkeley Price Channel

Infinity Pharmaceuti and Berkeley Lights Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Infinity Pharmaceuti and Berkeley Lights

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

Infinity Pharmaceuti

Pair trading matchups for Infinity Pharmaceuti

The idea behind Infinity Pharmaceuti and Berkeley Lights 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.

Berkeley Lights

Pair trading matchups for Berkeley Lights

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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

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