Correlation Between Palisade Bio and Ocugen

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

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

Diversification Opportunities for Palisade Bio and Ocugen

0.57

Correlation Coefficient

Palisade Bio  Ocugen

Very weak diversification

The 3 months correlation between Palisade and Ocugen is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Palisade Bio and Ocugen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocugen Inc and Palisade Bio 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 Palisade Bio are associated (or correlated) with Ocugen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocugen Inc has no effect on the direction of Palisade Bio i.e., Palisade Bio and Ocugen go up and down completely randomly.

Pair Corralation between Palisade Bio and Ocugen

Given the investment horizon of 90 days Palisade Bio is expected to generate 6.32 times more return on investment than Ocugen. However, Palisade Bio is 6.32 times more volatile than Ocugen Inc. It trades about 0.03 of its potential returns per unit of risk. Ocugen Inc is currently generating about -0.13 per unit of risk. If you would invest  239.00  in Palisade Bio on September 18, 2024 and sell it today you would lose (34.00) from holding Palisade Bio or give up 14.23% of portfolio value over 90 days.

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

Palisade Bio  vs.  Ocugen Inc

Palisade Bio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Palisade Bio 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 essential indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Ocugen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Palisade Bio and Ocugen

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

The idea behind Palisade Bio and Ocugen Inc 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.