Correlation Between Regen BioPharma and Oxford Nanopore

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

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

Diversification Opportunities for Regen BioPharma and Oxford Nanopore

0.42

Correlation Coefficient

Regen BioPharma  Oxford Nanopore

Very weak diversification

The 3 months correlation between Regen and Oxford is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Regen BioPharma and Oxford Nanopore Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Nanopore Tech and Regen BioPharma 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 Regen BioPharma are associated (or correlated) with Oxford Nanopore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Nanopore Tech has no effect on the direction of Regen BioPharma i.e., Regen BioPharma and Oxford Nanopore go up and down completely randomly.

Pair Corralation between Regen BioPharma and Oxford Nanopore

Given the investment horizon of 90 days Regen BioPharma is expected to generate 3.55 times more return on investment than Oxford Nanopore. However, Regen BioPharma is 3.55 times more volatile than Oxford Nanopore Technologies. It trades about 0.06 of its potential returns per unit of risk. Oxford Nanopore Technologies is currently generating about -0.03 per unit of risk. If you would invest  6.21  in Regen BioPharma on December 28, 2024 and sell it today you would lose (1.19) from holding Regen BioPharma or give up 19.16% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.77%
Values	Daily Returns

Regen BioPharma  vs.  Oxford Nanopore Technologies

Regen BioPharma

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Regen BioPharma are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent fundamental drivers, Regen BioPharma reported solid returns over the last few months and may actually be approaching a breakup point.

Oxford Nanopore Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Oxford Nanopore Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Regen BioPharma and Oxford Nanopore

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

The idea behind Regen BioPharma and Oxford Nanopore Technologies 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..