Correlation Between IREN and Codexis
Can any of the company-specific risk be diversified away by investing in both IREN and Codexis 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 IREN and Codexis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IREN and Codexis, you can compare the effects of market volatilities on IREN and Codexis 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 IREN with a short position of Codexis. Check out your portfolio center. Please also check ongoing floating volatility patterns of IREN and Codexis.
Diversification Opportunities for IREN and Codexis
Average diversification
The 3 months correlation between IREN and Codexis is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding IREN and Codexis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codexis and IREN 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 IREN are associated (or correlated) with Codexis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codexis has no effect on the direction of IREN i.e., IREN and Codexis go up and down completely randomly.
Pair Corralation between IREN and Codexis
Given the investment horizon of 90 days IREN is expected to generate 1.08 times more return on investment than Codexis. However, IREN is 1.08 times more volatile than Codexis. It trades about 0.33 of its potential returns per unit of risk. Codexis is currently generating about 0.03 per unit of risk. If you would invest 1,034 in IREN on June 7, 2025 and sell it today you would earn a total of 1,581 from holding IREN or generate 152.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IREN vs. Codexis
Performance |
| Timeline |
| IREN |
| Codexis |
IREN and Codexis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IREN and Codexis
The main advantage of trading using opposite IREN and Codexis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IREN position performs unexpectedly, Codexis 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 Codexis will offset losses from the drop in Codexis' long position.The idea behind IREN and Codexis 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.| Codexis vs. C4 Therapeutics | Codexis vs. CareDx Inc | Codexis vs. Erasca Inc | Codexis vs. Generation Bio Co |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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