Correlation Between Doximity and Inogen
Can any of the company-specific risk be diversified away by investing in both Doximity and Inogen 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 Doximity and Inogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doximity and Inogen Inc, you can compare the effects of market volatilities on Doximity and Inogen 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 Doximity with a short position of Inogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doximity and Inogen.
Diversification Opportunities for Doximity and Inogen
Modest diversification
The 3 months correlation between Doximity and Inogen is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and Inogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inogen Inc and Doximity 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 Doximity are associated (or correlated) with Inogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inogen Inc has no effect on the direction of Doximity i.e., Doximity and Inogen go up and down completely randomly.
Pair Corralation between Doximity and Inogen
Given the investment horizon of 90 days Doximity is expected to generate 2.22 times more return on investment than Inogen. However, Doximity is 2.22 times more volatile than Inogen Inc. It trades about 0.24 of its potential returns per unit of risk. Inogen Inc is currently generating about 0.04 per unit of risk. If you would invest 5,372 in Doximity on November 18, 2024 and sell it today you would earn a total of 2,335 from holding Doximity or generate 43.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doximity vs. Inogen Inc
Performance |
| Timeline |
| Doximity |
| Inogen Inc |
Doximity and Inogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doximity and Inogen
The main advantage of trading using opposite Doximity and Inogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doximity position performs unexpectedly, Inogen 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 Inogen will offset losses from the drop in Inogen's long position.The idea behind Doximity and Inogen Inc 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.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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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