Correlation Between Regeneron Pharmaceuticals and Getty Realty
Can any of the company-specific risk be diversified away by investing in both Regeneron Pharmaceuticals and Getty Realty 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 Regeneron Pharmaceuticals and Getty Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regeneron Pharmaceuticals and Getty Realty, you can compare the effects of market volatilities on Regeneron Pharmaceuticals and Getty Realty 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 Regeneron Pharmaceuticals with a short position of Getty Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regeneron Pharmaceuticals and Getty Realty.
Diversification Opportunities for Regeneron Pharmaceuticals and Getty Realty
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Regeneron and Getty is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Regeneron Pharmaceuticals and Getty Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Realty and Regeneron Pharmaceuticals 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 Regeneron Pharmaceuticals are associated (or correlated) with Getty Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Realty has no effect on the direction of Regeneron Pharmaceuticals i.e., Regeneron Pharmaceuticals and Getty Realty go up and down completely randomly.
Pair Corralation between Regeneron Pharmaceuticals and Getty Realty
Given the investment horizon of 90 days Regeneron Pharmaceuticals is expected to under-perform the Getty Realty. In addition to that, Regeneron Pharmaceuticals is 1.41 times more volatile than Getty Realty. It trades about -0.25 of its total potential returns per unit of risk. Getty Realty is currently generating about 0.06 per unit of volatility. If you would invest 3,197 in Getty Realty on September 13, 2024 and sell it today you would earn a total of 42.50 from holding Getty Realty or generate 1.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regeneron Pharmaceuticals vs. Getty Realty
Performance |
| Timeline |
| Regeneron Pharmaceuticals |
| Getty Realty |
Regeneron Pharmaceuticals and Getty Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regeneron Pharmaceuticals and Getty Realty
The main advantage of trading using opposite Regeneron Pharmaceuticals and Getty Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regeneron Pharmaceuticals position performs unexpectedly, Getty Realty 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 Getty Realty will offset losses from the drop in Getty Realty's long position.The idea behind Regeneron Pharmaceuticals and Getty Realty 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.
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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