Correlation Between Alcon AG and Repligen
Can any of the company-specific risk be diversified away by investing in both Alcon AG and Repligen 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 Alcon AG and Repligen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alcon AG and Repligen, you can compare the effects of market volatilities on Alcon AG and Repligen 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 Alcon AG with a short position of Repligen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcon AG and Repligen.
Diversification Opportunities for Alcon AG and Repligen
Weak diversification
The 3 months correlation between Alcon and Repligen is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Alcon AG and Repligen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Repligen and Alcon AG 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 Alcon AG are associated (or correlated) with Repligen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Repligen has no effect on the direction of Alcon AG i.e., Alcon AG and Repligen go up and down completely randomly.
Pair Corralation between Alcon AG and Repligen
Considering the 90-day investment horizon Alcon AG is expected to under-perform the Repligen. But the stock apears to be less risky and, when comparing its historical volatility, Alcon AG is 2.83 times less risky than Repligen. The stock trades about -0.3 of its potential returns per unit of risk. The Repligen is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 13,721 in Repligen on August 27, 2024 and sell it today you would earn a total of 885.00 from holding Repligen or generate 6.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alcon AG vs. Repligen
Performance |
| Timeline |
| Alcon AG |
| Repligen |
Alcon AG and Repligen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcon AG and Repligen
The main advantage of trading using opposite Alcon AG and Repligen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcon AG position performs unexpectedly, Repligen 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 Repligen will offset losses from the drop in Repligen's long position.| Alcon AG vs. Heartbeam | Alcon AG vs. EUDA Health Holdings | Alcon AG vs. Nutex Health | Alcon AG vs. Healthcare Triangle |
| Repligen vs. Intuitive Surgical | Repligen vs. ResMed Inc | Repligen vs. Merit Medical Systems | Repligen vs. ICU Medical |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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