Correlation Between Inogen and Venus Concept

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

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

Diversification Opportunities for Inogen and Venus Concept

0.49

Correlation Coefficient

Inogen  Venus Concept

Very weak diversification

The 3 months correlation between Inogen and Venus is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and Venus Concept in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Venus Concept and Inogen 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 Inogen Inc are associated (or correlated) with Venus Concept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Venus Concept has no effect on the direction of Inogen i.e., Inogen and Venus Concept go up and down completely randomly.

Pair Corralation between Inogen and Venus Concept

Given the investment horizon of 90 days Inogen Inc is expected to under-perform the Venus Concept. But the stock apears to be less risky and, when comparing its historical volatility, Inogen Inc is 3.34 times less risky than Venus Concept. The stock trades about -0.06 of its potential returns per unit of risk. The Venus Concept is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  392.00  in Venus Concept on December 27, 2024 and sell it today you would lose (64.00) from holding Venus Concept or give up 16.33% of portfolio value over 90 days.

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

Inogen Inc  vs.  Venus Concept

Inogen Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inogen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Venus Concept

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Venus Concept are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Venus Concept displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inogen and Venus Concept

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

The idea behind Inogen Inc and Venus Concept 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.