Correlation Between Evogene and OncoCyte Corp

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

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

Diversification Opportunities for Evogene and OncoCyte Corp

0.72

Correlation Coefficient

Evogene  OncoCyte Corp

Poor diversification

The 3 months correlation between Evogene and OncoCyte is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Evogene and OncoCyte Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OncoCyte Corp and Evogene 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 Evogene are associated (or correlated) with OncoCyte Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OncoCyte Corp has no effect on the direction of Evogene i.e., Evogene and OncoCyte Corp go up and down completely randomly.

Pair Corralation between Evogene and OncoCyte Corp

Given the investment horizon of 90 days Evogene is expected to under-perform the OncoCyte Corp. In addition to that, Evogene is 1.68 times more volatile than OncoCyte Corp. It trades about -0.17 of its total potential returns per unit of risk. OncoCyte Corp is currently generating about -0.11 per unit of volatility. If you would invest  314.00  in OncoCyte Corp on August 30, 2024 and sell it today you would lose (70.00) from holding OncoCyte Corp or give up 22.29% of portfolio value over 90 days.

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

Evogene  vs.  OncoCyte Corp

Evogene

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Evogene has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

OncoCyte Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OncoCyte Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Evogene and OncoCyte Corp

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

The idea behind Evogene and OncoCyte Corp 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 Transaction History module to view history of all your transactions and understand their impact on performance.