Correlation Between Intel and BIOGEN

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

By analyzing existing cross correlation between Intel and BIOGEN INC 52, you can compare the effects of market volatilities on Intel and BIOGEN 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 Intel with a short position of BIOGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and BIOGEN.

Diversification Opportunities for Intel and BIOGEN

-0.34

Correlation Coefficient

Intel  BIOGEN

Very good diversification

The 3 months correlation between Intel and BIOGEN is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Intel and BIOGEN INC 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIOGEN INC 52 and Intel 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 Intel are associated (or correlated) with BIOGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIOGEN INC 52 has no effect on the direction of Intel i.e., Intel and BIOGEN go up and down completely randomly.

Pair Corralation between Intel and BIOGEN

Given the investment horizon of 90 days Intel is expected to generate 1.53 times more return on investment than BIOGEN. However, Intel is 1.53 times more volatile than BIOGEN INC 52. It trades about 0.03 of its potential returns per unit of risk. BIOGEN INC 52 is currently generating about -0.14 per unit of risk. If you would invest  1,966  in Intel on September 13, 2024 and sell it today you would earn a total of  46.00  from holding Intel or generate 2.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.65%
Values	Daily Returns

Intel  vs.  BIOGEN INC 52

Intel

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Intel is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

BIOGEN INC 52

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BIOGEN INC 52 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for BIOGEN INC 52 investors.

Pair Trading with Intel and BIOGEN

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

The idea behind Intel and BIOGEN INC 52 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.