Correlation Between Amgen and Oculis Holding

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

By analyzing existing cross correlation between Amgen Inc and Oculis Holding AG, you can compare the effects of market volatilities on Amgen and Oculis Holding 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 Amgen with a short position of Oculis Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amgen and Oculis Holding.

Diversification Opportunities for Amgen and Oculis Holding

-0.43

Correlation Coefficient

Amgen  Oculis Holding

Very good diversification

The 3 months correlation between Amgen and Oculis is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Amgen Inc and Oculis Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oculis Holding AG and Amgen 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 Amgen Inc are associated (or correlated) with Oculis Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oculis Holding AG has no effect on the direction of Amgen i.e., Amgen and Oculis Holding go up and down completely randomly.

Pair Corralation between Amgen and Oculis Holding

Given the investment horizon of 90 days Amgen Inc is expected to under-perform the Oculis Holding. But the stock apears to be less risky and, when comparing its historical volatility, Amgen Inc is 2.02 times less risky than Oculis Holding. The stock trades about -0.13 of its potential returns per unit of risk. The Oculis Holding AG is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,200  in Oculis Holding AG on September 2, 2024 and sell it today you would earn a total of  404.00  from holding Oculis Holding AG or generate 33.67% return on investment over 90 days.

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

Amgen Inc  vs.  Oculis Holding AG

Amgen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amgen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Oculis Holding AG

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with Amgen and Oculis Holding

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

The idea behind Amgen Inc and Oculis Holding AG 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 Stocks Directory module to find actively traded stocks across global markets.