Correlation Between CEMEX SAB and FibroGen

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Can any of the company-specific risk be diversified away by investing in both CEMEX SAB and FibroGen 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 CEMEX SAB and FibroGen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEMEX SAB de and FibroGen, you can compare the effects of market volatilities on CEMEX SAB and FibroGen 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 CEMEX SAB with a short position of FibroGen. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEMEX SAB and FibroGen.

Diversification Opportunities for CEMEX SAB and FibroGen

CEMEXFibroGenDiversified AwayCEMEXFibroGenDiversified Away100%
0.28
  Correlation Coefficient

Modest diversification

The 3 months correlation between CEMEX and FibroGen is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding CEMEX SAB de and FibroGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FibroGen and CEMEX SAB 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 CEMEX SAB de are associated (or correlated) with FibroGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FibroGen has no effect on the direction of CEMEX SAB i.e., CEMEX SAB and FibroGen go up and down completely randomly.

Pair Corralation between CEMEX SAB and FibroGen

Assuming the 90 days trading horizon CEMEX SAB is expected to generate 26.05 times less return on investment than FibroGen. But when comparing it to its historical volatility, CEMEX SAB de is 3.6 times less risky than FibroGen. It trades about 0.0 of its potential returns per unit of risk. FibroGen is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  2,900  in FibroGen on November 26, 2024 and sell it today you would lose (1,399) from holding FibroGen or give up 48.24% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

CEMEX SAB de  vs.  FibroGen

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 020406080100
JavaScript chart by amCharts 3.21.15CEMEXCPO FGEN
       Timeline  
CEMEX SAB de 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in CEMEX SAB de are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, CEMEX SAB reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1111.51212.51313.514
FibroGen 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in FibroGen are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, FibroGen showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb789101112131415

CEMEX SAB and FibroGen Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.11-5.32-3.54-1.750.01.873.785.687.59 0.010.020.030.040.050.060.07
JavaScript chart by amCharts 3.21.15CEMEXCPO FGEN
       Returns  

Pair Trading with CEMEX SAB and FibroGen

The main advantage of trading using opposite CEMEX SAB and FibroGen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEMEX SAB position performs unexpectedly, FibroGen 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 FibroGen will offset losses from the drop in FibroGen's long position.
The idea behind CEMEX SAB de and FibroGen 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.
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.

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