Correlation Between Amgen and Bowen Acquisition
Can any of the company-specific risk be diversified away by investing in both Amgen and Bowen Acquisition 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 Amgen and Bowen Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amgen Inc and Bowen Acquisition Corp, you can compare the effects of market volatilities on Amgen and Bowen Acquisition 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 Amgen with a short position of Bowen Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amgen and Bowen Acquisition.
Diversification Opportunities for Amgen and Bowen Acquisition
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Amgen and Bowen is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Amgen Inc and Bowen Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bowen Acquisition Corp and Amgen 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 Amgen Inc are associated (or correlated) with Bowen Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bowen Acquisition Corp has no effect on the direction of Amgen i.e., Amgen and Bowen Acquisition go up and down completely randomly.
Pair Corralation between Amgen and Bowen Acquisition
Given the investment horizon of 90 days Amgen Inc is expected to generate 0.67 times more return on investment than Bowen Acquisition. However, Amgen Inc is 1.5 times less risky than Bowen Acquisition. It trades about 0.03 of its potential returns per unit of risk. Bowen Acquisition Corp is currently generating about -0.03 per unit of risk. If you would invest 23,746 in Amgen Inc on October 29, 2024 and sell it today you would earn a total of 3,796 from holding Amgen Inc or generate 15.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 80.31% |
| Values | Daily Returns |
Amgen Inc vs. Bowen Acquisition Corp
Performance |
| Timeline |
| Amgen Inc |
| Bowen Acquisition Corp |
Amgen and Bowen Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amgen and Bowen Acquisition
The main advantage of trading using opposite Amgen and Bowen Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amgen position performs unexpectedly, Bowen Acquisition 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 Bowen Acquisition will offset losses from the drop in Bowen Acquisition's long position.The idea behind Amgen Inc and Bowen Acquisition Corp 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.| Bowen Acquisition vs. AG Mortgage Investment | Bowen Acquisition vs. Apartment Investment and | Bowen Acquisition vs. Willamette Valley Vineyards | Bowen Acquisition vs. Aegon NV ADR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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