Correlation Between Axonics Modulation and Legend Biotech
Can any of the company-specific risk be diversified away by investing in both Axonics Modulation and Legend Biotech 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 Axonics Modulation and Legend Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axonics Modulation Technologies and Legend Biotech Corp, you can compare the effects of market volatilities on Axonics Modulation and Legend Biotech 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 Axonics Modulation with a short position of Legend Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axonics Modulation and Legend Biotech.
Diversification Opportunities for Axonics Modulation and Legend Biotech
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Axonics and Legend is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Axonics Modulation Technologie and Legend Biotech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legend Biotech Corp and Axonics Modulation 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 Axonics Modulation Technologies are associated (or correlated) with Legend Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legend Biotech Corp has no effect on the direction of Axonics Modulation i.e., Axonics Modulation and Legend Biotech go up and down completely randomly.
Pair Corralation between Axonics Modulation and Legend Biotech
Given the investment horizon of 90 days Axonics Modulation Technologies is expected to generate 0.11 times more return on investment than Legend Biotech. However, Axonics Modulation Technologies is 8.84 times less risky than Legend Biotech. It trades about 0.07 of its potential returns per unit of risk. Legend Biotech Corp is currently generating about -0.03 per unit of risk. If you would invest 6,788 in Axonics Modulation Technologies on August 28, 2024 and sell it today you would earn a total of 310.00 from holding Axonics Modulation Technologies or generate 4.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.65% |
| Values | Daily Returns |
Axonics Modulation Technologie vs. Legend Biotech Corp
Performance |
| Timeline |
| Axonics Modulation |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Legend Biotech Corp |
Axonics Modulation and Legend Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axonics Modulation and Legend Biotech
The main advantage of trading using opposite Axonics Modulation and Legend Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axonics Modulation position performs unexpectedly, Legend Biotech 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 Legend Biotech will offset losses from the drop in Legend Biotech's long position.| Axonics Modulation vs. Orthofix Medical | Axonics Modulation vs. Glaukos Corp | Axonics Modulation vs. Bruker | Axonics Modulation vs. Integer Holdings Corp |
| Legend Biotech vs. Vaxcyte | Legend Biotech vs. Apellis Pharmaceuticals | Legend Biotech vs. Travere Therapeutics | Legend Biotech vs. Akero Therapeutics |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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