Correlation Between Block and ImmunoCellular Therapeutics

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

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

Diversification Opportunities for Block and ImmunoCellular Therapeutics

-0.57

Correlation Coefficient

Block  ImmunoCellular Therapeutics

Excellent diversification

The 3 months correlation between Block and ImmunoCellular is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Block Inc and ImmunoCellular Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ImmunoCellular Therapeutics and Block 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 Block Inc are associated (or correlated) with ImmunoCellular Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ImmunoCellular Therapeutics has no effect on the direction of Block i.e., Block and ImmunoCellular Therapeutics go up and down completely randomly.

Pair Corralation between Block and ImmunoCellular Therapeutics

If you would invest  4,002  in Block Inc on January 25, 2024 and sell it today you would earn a total of  3,401  from holding Block Inc or generate 84.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	0.81%
Values	Daily Returns

Block Inc  vs.  ImmunoCellular Therapeutics

Block Inc

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Block Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Block reported solid returns over the last few months and may actually be approaching a breakup point.

ImmunoCellular Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ImmunoCellular Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, ImmunoCellular Therapeutics is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Block and ImmunoCellular Therapeutics

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

The idea behind Block Inc and ImmunoCellular Therapeutics 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.