Correlation Between Omeros and Biogen
Can any of the company-specific risk be diversified away by investing in both Omeros and Biogen 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 Omeros and Biogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Omeros and Biogen Inc, you can compare the effects of market volatilities on Omeros and Biogen 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 Omeros with a short position of Biogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omeros and Biogen.
Diversification Opportunities for Omeros and Biogen
Weak diversification
The 3 months correlation between Omeros and Biogen is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Omeros and Biogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biogen Inc and Omeros 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 Omeros are associated (or correlated) with Biogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biogen Inc has no effect on the direction of Omeros i.e., Omeros and Biogen go up and down completely randomly.
Pair Corralation between Omeros and Biogen
Assuming the 90 days horizon Omeros is expected to generate 1.83 times more return on investment than Biogen. However, Omeros is 1.83 times more volatile than Biogen Inc. It trades about 0.07 of its potential returns per unit of risk. Biogen Inc is currently generating about -0.08 per unit of risk. If you would invest 790.00 in Omeros on November 27, 2024 and sell it today you would earn a total of 32.00 from holding Omeros or generate 4.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Omeros vs. Biogen Inc
Performance |
| Timeline |
| Omeros |
| Biogen Inc |
Omeros and Biogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Omeros and Biogen
The main advantage of trading using opposite Omeros and Biogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omeros position performs unexpectedly, Biogen 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 Biogen will offset losses from the drop in Biogen's long position.| Omeros vs. EMPEROR ENT HOTEL | Omeros vs. Globex Mining Enterprises | Omeros vs. Meli Hotels International | Omeros vs. MELIA HOTELS |
| Biogen vs. UNIQA INSURANCE GR | Biogen vs. Sixt Leasing SE | Biogen vs. REVO INSURANCE SPA | Biogen vs. United Rentals |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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