Correlation Between OmniAb and Legend Biotech
Can any of the company-specific risk be diversified away by investing in both OmniAb 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 OmniAb and Legend Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OmniAb Inc and Legend Biotech Corp, you can compare the effects of market volatilities on OmniAb 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 OmniAb with a short position of Legend Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of OmniAb and Legend Biotech.
Diversification Opportunities for OmniAb and Legend Biotech
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OmniAb and Legend is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding OmniAb Inc 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 OmniAb 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 OmniAb Inc 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 OmniAb i.e., OmniAb and Legend Biotech go up and down completely randomly.
Pair Corralation between OmniAb and Legend Biotech
Given the investment horizon of 90 days OmniAb Inc is expected to generate 0.97 times more return on investment than Legend Biotech. However, OmniAb Inc is 1.03 times less risky than Legend Biotech. It trades about -0.01 of its potential returns per unit of risk. Legend Biotech Corp is currently generating about -0.04 per unit of risk. If you would invest 460.00 in OmniAb Inc on August 27, 2024 and sell it today you would lose (68.00) from holding OmniAb Inc or give up 14.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OmniAb Inc vs. Legend Biotech Corp
Performance |
| Timeline |
| OmniAb Inc |
| Legend Biotech Corp |
OmniAb and Legend Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OmniAb and Legend Biotech
The main advantage of trading using opposite OmniAb and Legend Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OmniAb 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.| OmniAb vs. Legend Biotech Corp | OmniAb vs. Verona Pharma PLC | OmniAb vs. Ideaya Biosciences | OmniAb vs. Iteos Therapeutics |
| Legend Biotech vs. Eliem Therapeutics | Legend Biotech vs. HCW Biologics | Legend Biotech vs. Scpharmaceuticals | Legend Biotech vs. Milestone Pharmaceuticals |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |