Correlation Between Blue Owl and Collegium Pharmaceutical
Can any of the company-specific risk be diversified away by investing in both Blue Owl and Collegium Pharmaceutical 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 Blue Owl and Collegium Pharmaceutical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Owl Capital and Collegium Pharmaceutical, you can compare the effects of market volatilities on Blue Owl and Collegium Pharmaceutical 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 Blue Owl with a short position of Collegium Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Owl and Collegium Pharmaceutical.
Diversification Opportunities for Blue Owl and Collegium Pharmaceutical
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Blue and Collegium is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Blue Owl Capital and Collegium Pharmaceutical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collegium Pharmaceutical and Blue Owl 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 Blue Owl Capital are associated (or correlated) with Collegium Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collegium Pharmaceutical has no effect on the direction of Blue Owl i.e., Blue Owl and Collegium Pharmaceutical go up and down completely randomly.
Pair Corralation between Blue Owl and Collegium Pharmaceutical
Considering the 90-day investment horizon Blue Owl Capital is expected to generate 1.16 times more return on investment than Collegium Pharmaceutical. However, Blue Owl is 1.16 times more volatile than Collegium Pharmaceutical. It trades about 0.13 of its potential returns per unit of risk. Collegium Pharmaceutical is currently generating about -0.21 per unit of risk. If you would invest 2,218 in Blue Owl Capital on September 1, 2024 and sell it today you would earn a total of 155.00 from holding Blue Owl Capital or generate 6.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Owl Capital vs. Collegium Pharmaceutical
Performance |
| Timeline |
| Blue Owl Capital |
| Collegium Pharmaceutical |
Blue Owl and Collegium Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Owl and Collegium Pharmaceutical
The main advantage of trading using opposite Blue Owl and Collegium Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Owl position performs unexpectedly, Collegium Pharmaceutical 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 Collegium Pharmaceutical will offset losses from the drop in Collegium Pharmaceutical's long position.| Blue Owl vs. Apollo Global Management | Blue Owl vs. KKR Co LP | Blue Owl vs. Affiliated Managers Group | Blue Owl vs. Ares Capital |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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