Correlation Between Ocular Therapeutix and Magenta Therapeutics
Can any of the company-specific risk be diversified away by investing in both Ocular Therapeutix and Magenta Therapeutics 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 Ocular Therapeutix and Magenta Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocular Therapeutix and Magenta Therapeutics, you can compare the effects of market volatilities on Ocular Therapeutix and Magenta Therapeutics 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 Ocular Therapeutix with a short position of Magenta Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocular Therapeutix and Magenta Therapeutics.
Diversification Opportunities for Ocular Therapeutix and Magenta Therapeutics
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ocular and Magenta is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ocular Therapeutix and Magenta Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magenta Therapeutics and Ocular Therapeutix 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 Ocular Therapeutix are associated (or correlated) with Magenta Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magenta Therapeutics has no effect on the direction of Ocular Therapeutix i.e., Ocular Therapeutix and Magenta Therapeutics go up and down completely randomly.
Pair Corralation between Ocular Therapeutix and Magenta Therapeutics
If you would invest 791.00 in Ocular Therapeutix on October 22, 2024 and sell it today you would earn a total of 10.00 from holding Ocular Therapeutix or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.81% |
| Values | Daily Returns |
Ocular Therapeutix vs. Magenta Therapeutics
Performance |
| Timeline |
| Ocular Therapeutix |
| Magenta Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ocular Therapeutix and Magenta Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocular Therapeutix and Magenta Therapeutics
The main advantage of trading using opposite Ocular Therapeutix and Magenta Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocular Therapeutix position performs unexpectedly, Magenta Therapeutics 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 Magenta Therapeutics will offset losses from the drop in Magenta Therapeutics' long position.| Ocular Therapeutix vs. CytomX Therapeutics | Ocular Therapeutix vs. Assembly Biosciences | Ocular Therapeutix vs. Spero Therapeutics | Ocular Therapeutix vs. Achilles Therapeutics PLC |
| Magenta Therapeutics vs. Assembly Biosciences | Magenta Therapeutics vs. Instil Bio | Magenta Therapeutics vs. Nuvation Bio | Magenta Therapeutics vs. Achilles Therapeutics PLC |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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