Correlation Between Vaxcyte and Iteos Therapeutics

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

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

Diversification Opportunities for Vaxcyte and Iteos Therapeutics

0.35

Correlation Coefficient

Vaxcyte  Iteos Therapeutics

Weak diversification

The 3 months correlation between Vaxcyte and Iteos is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Vaxcyte and Iteos Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iteos Therapeutics and Vaxcyte 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 Vaxcyte are associated (or correlated) with Iteos Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iteos Therapeutics has no effect on the direction of Vaxcyte i.e., Vaxcyte and Iteos Therapeutics go up and down completely randomly.

Pair Corralation between Vaxcyte and Iteos Therapeutics

Given the investment horizon of 90 days Vaxcyte is expected to under-perform the Iteos Therapeutics. In addition to that, Vaxcyte is 1.19 times more volatile than Iteos Therapeutics. It trades about -0.02 of its total potential returns per unit of risk. Iteos Therapeutics is currently generating about 0.15 per unit of volatility. If you would invest  822.00  in Iteos Therapeutics on May 21, 2025 and sell it today you would earn a total of  189.00  from holding Iteos Therapeutics or generate 22.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Vaxcyte  vs.  Iteos Therapeutics

Vaxcyte

Risk-Adjusted Performance

Weakest

Over the last 90 days Vaxcyte has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Vaxcyte is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Iteos Therapeutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Iteos Therapeutics are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Iteos Therapeutics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vaxcyte and Iteos Therapeutics

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

The idea behind Vaxcyte and Iteos 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.