Correlation Between Collegium Pharmaceutical and Alimera Sciences
Can any of the company-specific risk be diversified away by investing in both Collegium Pharmaceutical and Alimera Sciences 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 Collegium Pharmaceutical and Alimera Sciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Collegium Pharmaceutical and Alimera Sciences, you can compare the effects of market volatilities on Collegium Pharmaceutical and Alimera Sciences 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 Collegium Pharmaceutical with a short position of Alimera Sciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Collegium Pharmaceutical and Alimera Sciences.
Diversification Opportunities for Collegium Pharmaceutical and Alimera Sciences
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Collegium and Alimera is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Collegium Pharmaceutical and Alimera Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alimera Sciences and Collegium Pharmaceutical 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 Collegium Pharmaceutical are associated (or correlated) with Alimera Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alimera Sciences has no effect on the direction of Collegium Pharmaceutical i.e., Collegium Pharmaceutical and Alimera Sciences go up and down completely randomly.
Pair Corralation between Collegium Pharmaceutical and Alimera Sciences
If you would invest 554.00 in Alimera Sciences on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Alimera Sciences or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Collegium Pharmaceutical vs. Alimera Sciences
Performance |
| Timeline |
| Collegium Pharmaceutical |
| Alimera Sciences |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Collegium Pharmaceutical and Alimera Sciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Collegium Pharmaceutical and Alimera Sciences
The main advantage of trading using opposite Collegium Pharmaceutical and Alimera Sciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Collegium Pharmaceutical position performs unexpectedly, Alimera Sciences 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 Alimera Sciences will offset losses from the drop in Alimera Sciences' long position.| Collegium Pharmaceutical vs. Phibro Animal Health | Collegium Pharmaceutical vs. ANI Pharmaceuticals | Collegium Pharmaceutical vs. Procaps Group SA | Collegium Pharmaceutical vs. Amphastar P |
| Alimera Sciences vs. Shuttle Pharmaceuticals | Alimera Sciences vs. Lifecore Biomedical | Alimera Sciences vs. Journey Medical Corp | Alimera Sciences vs. Organogenesis Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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