Correlation Between Exagen and Inotiv
Can any of the company-specific risk be diversified away by investing in both Exagen and Inotiv 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 Exagen and Inotiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exagen Inc and Inotiv Inc, you can compare the effects of market volatilities on Exagen and Inotiv 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 Exagen with a short position of Inotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exagen and Inotiv.
Diversification Opportunities for Exagen and Inotiv
Weak diversification
The 3 months correlation between Exagen and Inotiv is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Exagen Inc and Inotiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inotiv Inc and Exagen 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 Exagen Inc are associated (or correlated) with Inotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inotiv Inc has no effect on the direction of Exagen i.e., Exagen and Inotiv go up and down completely randomly.
Pair Corralation between Exagen and Inotiv
Considering the 90-day investment horizon Exagen is expected to generate 1.51 times less return on investment than Inotiv. But when comparing it to its historical volatility, Exagen Inc is 1.25 times less risky than Inotiv. It trades about 0.36 of its potential returns per unit of risk. Inotiv Inc is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 182.00 in Inotiv Inc on August 27, 2024 and sell it today you would earn a total of 177.00 from holding Inotiv Inc or generate 97.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exagen Inc vs. Inotiv Inc
Performance |
| Timeline |
| Exagen Inc |
| Inotiv Inc |
Exagen and Inotiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exagen and Inotiv
The main advantage of trading using opposite Exagen and Inotiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exagen position performs unexpectedly, Inotiv 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 Inotiv will offset losses from the drop in Inotiv's long position.| Exagen vs. Fonar | Exagen vs. Burning Rock Biotech | Exagen vs. Sera Prognostics | Exagen vs. Castle Biosciences |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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