Correlation Between Agilent Technologies and Scilex Holding
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Scilex Holding 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 Agilent Technologies and Scilex Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Scilex Holding, you can compare the effects of market volatilities on Agilent Technologies and Scilex Holding 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 Agilent Technologies with a short position of Scilex Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Scilex Holding.
Diversification Opportunities for Agilent Technologies and Scilex Holding
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agilent and Scilex is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Scilex Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scilex Holding and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Scilex Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scilex Holding has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Scilex Holding go up and down completely randomly.
Pair Corralation between Agilent Technologies and Scilex Holding
Taking into account the 90-day investment horizon Agilent Technologies is expected to under-perform the Scilex Holding. But the stock apears to be less risky and, when comparing its historical volatility, Agilent Technologies is 12.21 times less risky than Scilex Holding. The stock trades about -0.13 of its potential returns per unit of risk. The Scilex Holding is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 26.00 in Scilex Holding on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Scilex Holding or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Scilex Holding
Performance |
| Timeline |
| Agilent Technologies |
| Scilex Holding |
Agilent Technologies and Scilex Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Scilex Holding
The main advantage of trading using opposite Agilent Technologies and Scilex Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Scilex Holding 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 Scilex Holding will offset losses from the drop in Scilex Holding's long position.| Agilent Technologies vs. Fonar | Agilent Technologies vs. Burning Rock Biotech | Agilent Technologies vs. Sera Prognostics | Agilent Technologies vs. Exagen Inc |
| Scilex Holding vs. Vince Holding Corp | Scilex Holding vs. Citi Trends | Scilex Holding vs. Under Armour C | Scilex Holding vs. SEI Investments |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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