Correlation Between Chevron Corp and Regeneron Pharmaceuticals

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Chevron Corp 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 Chevron Corp and Regeneron Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chevron Corp and Regeneron Pharmaceuticals, you can compare the effects of market volatilities on Chevron Corp 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 Chevron Corp with a short position of Regeneron Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron Corp and Regeneron Pharmaceuticals.

Diversification Opportunities for Chevron Corp and Regeneron Pharmaceuticals

0.47
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Chevron and Regeneron is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and Regeneron Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regeneron Pharmaceuticals and Chevron Corp 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 Chevron Corp 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 Chevron Corp i.e., Chevron Corp and Regeneron Pharmaceuticals go up and down completely randomly.

Pair Corralation between Chevron Corp and Regeneron Pharmaceuticals

Considering the 90-day investment horizon Chevron Corp is expected to generate 1.42 times more return on investment than Regeneron Pharmaceuticals. However, Chevron Corp is 1.42 times more volatile than Regeneron Pharmaceuticals. It trades about 0.16 of its potential returns per unit of risk. Regeneron Pharmaceuticals is currently generating about 0.08 per unit of risk. If you would invest  14,151  in Chevron Corp on May 11, 2022 and sell it today you would earn a total of  1,190  from holding Chevron Corp or generate 8.41% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Chevron Corp  vs.  Regeneron Pharmaceuticals

 Performance (%) 
       Timeline  
Chevron Corp 
Chevron Performance
0 of 100
Over the last 90 days Chevron Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Chevron Corp is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Chevron Price Channel

Regeneron Pharmaceuticals 
Regeneron Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Regeneron Pharmaceuticals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent technical and fundamental indicators, Regeneron Pharmaceuticals is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Regeneron Price Channel

Chevron Corp and Regeneron Pharmaceuticals Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Chevron Corp and Regeneron Pharmaceuticals

The main advantage of trading using opposite Chevron Corp and Regeneron Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron Corp 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 Chevron Corp 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.
Check out your portfolio center. 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 Fund Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.

Other Complementary Tools

Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Go
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Go
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
CEO Directory
Screen CEOs from public companies around the world
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Go