Correlation Between Figs and Evofem Biosciences

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

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

Diversification Opportunities for Figs and Evofem Biosciences

0.24

Correlation Coefficient

Figs  Evofem Biosciences

Modest diversification

The 3 months correlation between Figs and Evofem is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Figs Inc and Evofem Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evofem Biosciences and Figs 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 Figs Inc are associated (or correlated) with Evofem Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evofem Biosciences has no effect on the direction of Figs i.e., Figs and Evofem Biosciences go up and down completely randomly.

Pair Corralation between Figs and Evofem Biosciences

If you would invest  475.00  in Figs Inc on September 12, 2024 and sell it today you would earn a total of  38.00  from holding Figs Inc or generate 8.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

Figs Inc  vs.  Evofem Biosciences

Figs Inc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Figs Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Figs may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Evofem Biosciences

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Figs and Evofem Biosciences

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

The idea behind Figs Inc and Evofem Biosciences 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 Transaction History module to view history of all your transactions and understand their impact on performance.