Correlation Between Repligen and Viking Holdings

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

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

Diversification Opportunities for Repligen and Viking Holdings

0.44

Correlation Coefficient

Repligen  Viking Holdings

Very weak diversification

The 3 months correlation between Repligen and Viking is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Repligen and Viking Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Holdings and Repligen 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 Repligen are associated (or correlated) with Viking Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Holdings has no effect on the direction of Repligen i.e., Repligen and Viking Holdings go up and down completely randomly.

Pair Corralation between Repligen and Viking Holdings

Given the investment horizon of 90 days Repligen is expected to generate 1.7 times more return on investment than Viking Holdings. However, Repligen is 1.7 times more volatile than Viking Holdings. It trades about 0.04 of its potential returns per unit of risk. Viking Holdings is currently generating about 0.05 per unit of risk. If you would invest  14,595  in Repligen on October 6, 2024 and sell it today you would earn a total of  395.00  from holding Repligen or generate 2.71% return on investment over 90 days.

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

Repligen  vs.  Viking Holdings

Repligen

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Repligen are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile technical and fundamental indicators, Repligen displayed solid returns over the last few months and may actually be approaching a breakup point.

Viking Holdings

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Viking Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward indicators, Viking Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Repligen and Viking Holdings

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

The idea behind Repligen and Viking Holdings 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.

Check out your portfolio center.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.