Correlation Between Chimerix and AMGEN

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

By analyzing existing cross correlation between Chimerix and AMGEN INC 6375, you can compare the effects of market volatilities on Chimerix and AMGEN 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 Chimerix with a short position of AMGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chimerix and AMGEN.

Diversification Opportunities for Chimerix and AMGEN

-0.16

Correlation Coefficient

Chimerix  AMGEN

Good diversification

The 3 months correlation between Chimerix and AMGEN is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Chimerix and AMGEN INC 6375 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGEN INC 6375 and Chimerix 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 Chimerix are associated (or correlated) with AMGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGEN INC 6375 has no effect on the direction of Chimerix i.e., Chimerix and AMGEN go up and down completely randomly.

Pair Corralation between Chimerix and AMGEN

Given the investment horizon of 90 days Chimerix is expected to generate 2.96 times more return on investment than AMGEN. However, Chimerix is 2.96 times more volatile than AMGEN INC 6375. It trades about 0.0 of its potential returns per unit of risk. AMGEN INC 6375 is currently generating about -0.06 per unit of risk. If you would invest  88.00  in Chimerix on September 5, 2024 and sell it today you would lose (2.00) from holding Chimerix or give up 2.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	65.63%
Values	Daily Returns

Chimerix  vs.  AMGEN INC 6375

Chimerix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chimerix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Chimerix is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

AMGEN INC 6375

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AMGEN INC 6375 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, AMGEN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Chimerix and AMGEN

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

The idea behind Chimerix and AMGEN INC 6375 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.