Correlation Between Amgen and ClearOne
Can any of the company-specific risk be diversified away by investing in both Amgen and ClearOne 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 ClearOne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amgen Inc and ClearOne, you can compare the effects of market volatilities on Amgen and ClearOne 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 ClearOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amgen and ClearOne.
Diversification Opportunities for Amgen and ClearOne
Very weak diversification
The 3 months correlation between Amgen and ClearOne is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Amgen Inc and ClearOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClearOne 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 ClearOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClearOne has no effect on the direction of Amgen i.e., Amgen and ClearOne go up and down completely randomly.
Pair Corralation between Amgen and ClearOne
Given the investment horizon of 90 days Amgen Inc is expected to under-perform the ClearOne. But the stock apears to be less risky and, when comparing its historical volatility, Amgen Inc is 2.66 times less risky than ClearOne. The stock trades about -0.19 of its potential returns per unit of risk. The ClearOne is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 55.00 in ClearOne on September 13, 2024 and sell it today you would earn a total of 3.00 from holding ClearOne or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amgen Inc vs. ClearOne
Performance |
| Timeline |
| Amgen Inc |
| ClearOne |
Amgen and ClearOne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amgen and ClearOne
The main advantage of trading using opposite Amgen and ClearOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amgen position performs unexpectedly, ClearOne 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 ClearOne will offset losses from the drop in ClearOne's long position.| Amgen vs. Puma Biotechnology | Amgen vs. Iovance Biotherapeutics | Amgen vs. Sarepta Therapeutics | Amgen vs. Day One Biopharmaceuticals |
| ClearOne vs. Actelis Networks | ClearOne vs. Siyata Mobile | ClearOne vs. SatixFy Communications | ClearOne vs. Mobilicom Limited American |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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