Correlation Between Regeneron Pharmaceuticals and Cell Source

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

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

Diversification Opportunities for Regeneron Pharmaceuticals and Cell Source

-0.68

Correlation Coefficient

Regeneron Pharmaceuticals  Cell Source

Excellent diversification

The 3 months correlation between Regeneron and Cell is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Regeneron Pharmaceuticals and Cell Source in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cell Source and Regeneron Pharmaceuticals 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 Regeneron Pharmaceuticals are associated (or correlated) with Cell Source. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cell Source has no effect on the direction of Regeneron Pharmaceuticals i.e., Regeneron Pharmaceuticals and Cell Source go up and down completely randomly.

Pair Corralation between Regeneron Pharmaceuticals and Cell Source

Given the investment horizon of 90 days Regeneron Pharmaceuticals is expected to under-perform the Cell Source. But the stock apears to be less risky and, when comparing its historical volatility, Regeneron Pharmaceuticals is 48.59 times less risky than Cell Source. The stock trades about 0.0 of its potential returns per unit of risk. The Cell Source is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  44.00  in Cell Source on October 5, 2024 and sell it today you would lose (9.00) from holding Cell Source or give up 20.45% of portfolio value over 90 days.

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

Regeneron Pharmaceuticals  vs.  Cell Source

Regeneron Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Regeneron Pharmaceuticals 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 February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Cell Source

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cell Source are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental indicators, Cell Source unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Regeneron Pharmaceuticals and Cell Source

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

The idea behind Regeneron Pharmaceuticals and Cell Source 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.