Correlation Between Si Bone and Axogen

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

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

Diversification Opportunities for Si Bone and Axogen

0.13

Correlation Coefficient

Si Bone  Axogen

Average diversification

The 3 months correlation between SIBN and Axogen is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Si Bone and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and Si Bone 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 Si Bone are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of Si Bone i.e., Si Bone and Axogen go up and down completely randomly.

Pair Corralation between Si Bone and Axogen

Given the investment horizon of 90 days Si Bone is expected to generate 2.42 times less return on investment than Axogen. But when comparing it to its historical volatility, Si Bone is 1.35 times less risky than Axogen. It trades about 0.02 of its potential returns per unit of risk. Axogen Inc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,063  in Axogen Inc on September 2, 2024 and sell it today you would earn a total of  327.00  from holding Axogen Inc or generate 30.76% return on investment over 90 days.

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

Si Bone  vs.  Axogen Inc

Si Bone

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Si Bone has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental drivers remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Axogen Inc

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Axogen Inc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting technical and fundamental indicators, Axogen may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Si Bone and Axogen

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

The idea behind Si Bone and Axogen 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.