Correlation Between Intel and PepGen

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

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

Diversification Opportunities for Intel and PepGen

-0.2

Correlation Coefficient

Intel  PepGen

Good diversification

The 3 months correlation between Intel and PepGen is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Intel and PepGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PepGen and Intel 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 Intel are associated (or correlated) with PepGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PepGen has no effect on the direction of Intel i.e., Intel and PepGen go up and down completely randomly.

Pair Corralation between Intel and PepGen

Given the investment horizon of 90 days Intel is expected to generate 0.29 times more return on investment than PepGen. However, Intel is 3.41 times less risky than PepGen. It trades about 0.07 of its potential returns per unit of risk. PepGen is currently generating about -0.04 per unit of risk. If you would invest  1,982  in Intel on December 28, 2024 and sell it today you would earn a total of  289.00  from holding Intel or generate 14.58% return on investment over 90 days.

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

Intel  vs.  PepGen

Intel

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Intel exhibited solid returns over the last few months and may actually be approaching a breakup point.

PepGen

Risk-Adjusted Performance

Very Weak

Over the last 90 days PepGen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Intel and PepGen

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

The idea behind Intel and PepGen 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.