Correlation Between Inogen and Bioventus
Can any of the company-specific risk be diversified away by investing in both Inogen and Bioventus 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 Inogen and Bioventus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inogen Inc and Bioventus, you can compare the effects of market volatilities on Inogen and Bioventus 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 Inogen with a short position of Bioventus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inogen and Bioventus.
Diversification Opportunities for Inogen and Bioventus
Pay attention - limited upside
The 3 months correlation between Inogen and Bioventus is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and Bioventus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bioventus and Inogen 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 Inogen Inc are associated (or correlated) with Bioventus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bioventus has no effect on the direction of Inogen i.e., Inogen and Bioventus go up and down completely randomly.
Pair Corralation between Inogen and Bioventus
Given the investment horizon of 90 days Inogen Inc is expected to generate 1.06 times more return on investment than Bioventus. However, Inogen is 1.06 times more volatile than Bioventus. It trades about 0.03 of its potential returns per unit of risk. Bioventus is currently generating about -0.09 per unit of risk. If you would invest 929.00 in Inogen Inc on August 27, 2024 and sell it today you would earn a total of 9.00 from holding Inogen Inc or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inogen Inc vs. Bioventus
Performance |
| Timeline |
| Inogen Inc |
| Bioventus |
Inogen and Bioventus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inogen and Bioventus
The main advantage of trading using opposite Inogen and Bioventus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inogen position performs unexpectedly, Bioventus 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 Bioventus will offset losses from the drop in Bioventus' long position.The idea behind Inogen Inc and Bioventus 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.| Bioventus vs. Tivic Health Systems | Bioventus vs. Bluejay Diagnostics | Bioventus vs. Heart Test Laboratories | Bioventus vs. Nuwellis |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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