Correlation Between Artisan Consumer and Regeneron Pharmaceuticals

Can any of the company-specific risk be diversified away by investing in both Artisan Consumer and Regeneron Pharmaceuticals 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 Artisan Consumer and Regeneron Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Artisan Consumer Goods and Regeneron Pharmaceuticals, you can compare the effects of market volatilities on Artisan Consumer and Regeneron Pharmaceuticals 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 Artisan Consumer with a short position of Regeneron Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artisan Consumer and Regeneron Pharmaceuticals.

Diversification Opportunities for Artisan Consumer and Regeneron Pharmaceuticals

-0.02

Correlation Coefficient

Artisan Consumer  Regeneron Pharmaceuticals

Good diversification

The 3 months correlation between Artisan and Regeneron is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Artisan Consumer Goods and Regeneron Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regeneron Pharmaceuticals and Artisan Consumer 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 Artisan Consumer Goods are associated (or correlated) with Regeneron Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regeneron Pharmaceuticals has no effect on the direction of Artisan Consumer i.e., Artisan Consumer and Regeneron Pharmaceuticals go up and down completely randomly.

Pair Corralation between Artisan Consumer and Regeneron Pharmaceuticals

Given the investment horizon of 90 days Artisan Consumer Goods is expected to generate 10.59 times more return on investment than Regeneron Pharmaceuticals. However, Artisan Consumer is 10.59 times more volatile than Regeneron Pharmaceuticals. It trades about 0.21 of its potential returns per unit of risk. Regeneron Pharmaceuticals is currently generating about 0.06 per unit of risk. If you would invest  14.00  in Artisan Consumer Goods on February 5, 2024 and sell it today you would earn a total of  9.00  from holding Artisan Consumer Goods or generate 64.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Artisan Consumer Goods  vs.  Regeneron Pharmaceuticals

Artisan Consumer Goods

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Consumer Goods are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Artisan Consumer unveiled solid returns over the last few months and may actually be approaching a breakup point.

Regeneron Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Regeneron Pharmaceuticals are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Regeneron Pharmaceuticals is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Artisan Consumer and Regeneron Pharmaceuticals

The main advantage of trading using opposite Artisan Consumer and Regeneron Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artisan Consumer position performs unexpectedly, Regeneron Pharmaceuticals 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 Regeneron Pharmaceuticals will offset losses from the drop in Regeneron Pharmaceuticals' long position.

The idea behind Artisan Consumer Goods and Regeneron Pharmaceuticals 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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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.