Correlation Between Femasys and Douglas Emmett

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

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

Diversification Opportunities for Femasys and Douglas Emmett

-0.03

Correlation Coefficient

Femasys  Douglas Emmett

Good diversification

The 3 months correlation between Femasys and Douglas is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Femasys and Douglas Emmett in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Douglas Emmett and Femasys 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 Femasys are associated (or correlated) with Douglas Emmett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Douglas Emmett has no effect on the direction of Femasys i.e., Femasys and Douglas Emmett go up and down completely randomly.

Pair Corralation between Femasys and Douglas Emmett

Given the investment horizon of 90 days Femasys is expected to generate 2.69 times less return on investment than Douglas Emmett. In addition to that, Femasys is 2.01 times more volatile than Douglas Emmett. It trades about 0.02 of its total potential returns per unit of risk. Douglas Emmett is currently generating about 0.09 per unit of volatility. If you would invest  1,725  in Douglas Emmett on October 8, 2024 and sell it today you would earn a total of  169.00  from holding Douglas Emmett or generate 9.8% return on investment over 90 days.

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

Femasys  vs.  Douglas Emmett

Femasys

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Femasys are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong primary indicators, Femasys is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Douglas Emmett

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Douglas Emmett are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating technical and fundamental indicators, Douglas Emmett may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Femasys and Douglas Emmett

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

The idea behind Femasys and Douglas Emmett 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.