Correlation Between Ocuphire Pharma and Fortress Biotech
Can any of the company-specific risk be diversified away by investing in both Ocuphire Pharma and Fortress 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 Ocuphire Pharma and Fortress Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocuphire Pharma and Fortress Biotech, you can compare the effects of market volatilities on Ocuphire Pharma and Fortress 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 Ocuphire Pharma with a short position of Fortress Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocuphire Pharma and Fortress Biotech.
Diversification Opportunities for Ocuphire Pharma and Fortress Biotech
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ocuphire and Fortress is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ocuphire Pharma and Fortress Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Biotech and Ocuphire Pharma 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 Ocuphire Pharma are associated (or correlated) with Fortress Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Biotech has no effect on the direction of Ocuphire Pharma i.e., Ocuphire Pharma and Fortress Biotech go up and down completely randomly.
Pair Corralation between Ocuphire Pharma and Fortress Biotech
Given the investment horizon of 90 days Ocuphire Pharma is expected to generate 0.7 times more return on investment than Fortress Biotech. However, Ocuphire Pharma is 1.43 times less risky than Fortress Biotech. It trades about -0.02 of its potential returns per unit of risk. Fortress Biotech is currently generating about -0.02 per unit of risk. If you would invest 308.00 in Ocuphire Pharma on August 29, 2024 and sell it today you would lose (195.00) from holding Ocuphire Pharma or give up 63.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.56% |
| Values | Daily Returns |
Ocuphire Pharma vs. Fortress Biotech
Performance |
| Timeline |
| Ocuphire Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fortress Biotech |
Ocuphire Pharma and Fortress Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocuphire Pharma and Fortress Biotech
The main advantage of trading using opposite Ocuphire Pharma and Fortress Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocuphire Pharma position performs unexpectedly, Fortress 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 Fortress Biotech will offset losses from the drop in Fortress Biotech's long position.| Ocuphire Pharma vs. Reviva Pharmaceuticals Holdings | Ocuphire Pharma vs. Protalix Biotherapeutics | Ocuphire Pharma vs. Eyepoint Pharmaceuticals | Ocuphire Pharma vs. Sellas Life Sciences |
| Fortress Biotech vs. Mustang Bio | Fortress Biotech vs. Achilles Therapeutics PLC | Fortress Biotech vs. Aptose Biosciences | Fortress Biotech vs. Fortress Biotech Pref |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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