Correlation Between Tegna and Genscript Biotech
Can any of the company-specific risk be diversified away by investing in both Tegna and Genscript 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 Tegna and Genscript Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tegna Inc and Genscript Biotech, you can compare the effects of market volatilities on Tegna and Genscript 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 Tegna with a short position of Genscript Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tegna and Genscript Biotech.
Diversification Opportunities for Tegna and Genscript Biotech
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tegna and Genscript is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Tegna Inc and Genscript Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genscript Biotech and Tegna 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 Tegna Inc are associated (or correlated) with Genscript Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genscript Biotech has no effect on the direction of Tegna i.e., Tegna and Genscript Biotech go up and down completely randomly.
Pair Corralation between Tegna and Genscript Biotech
Given the investment horizon of 90 days Tegna Inc is expected to under-perform the Genscript Biotech. But the stock apears to be less risky and, when comparing its historical volatility, Tegna Inc is 2.19 times less risky than Genscript Biotech. The stock trades about -0.13 of its potential returns per unit of risk. The Genscript Biotech is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 127.00 in Genscript Biotech on November 5, 2024 and sell it today you would earn a total of 9.00 from holding Genscript Biotech or generate 7.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Tegna Inc vs. Genscript Biotech
Performance |
| Timeline |
| Tegna Inc |
| Genscript Biotech |
Tegna and Genscript Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tegna and Genscript Biotech
The main advantage of trading using opposite Tegna and Genscript Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tegna position performs unexpectedly, Genscript 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 Genscript Biotech will offset losses from the drop in Genscript Biotech's long position.| Tegna vs. E W Scripps | Tegna vs. Gray Television | Tegna vs. iHeartMedia Class A | Tegna vs. Cumulus Media Class |
| Genscript Biotech vs. Telix Pharmaceuticals Limited | Genscript Biotech vs. Keros Therapeutics | Genscript Biotech vs. Zentalis Pharmaceuticals Llc | Genscript Biotech vs. Innovent Biologics |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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