Correlation Between Zoetis Inc and Regeneron Pharmaceuticals

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

Diversification Opportunities for Zoetis Inc and Regeneron Pharmaceuticals

0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between Zoetis and Regeneron is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Zoetis Inc Cl and Regeneron Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regeneron Pharmaceuticals and Zoetis Inc 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 Zoetis Inc Cl 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 Zoetis Inc i.e., Zoetis Inc and Regeneron Pharmaceuticals go up and down completely randomly.

Pair Corralation between Zoetis Inc and Regeneron Pharmaceuticals

Considering the 90-day investment horizon Zoetis Inc Cl is expected to generate 0.82 times more return on investment than Regeneron Pharmaceuticals. However, Zoetis Inc Cl is 1.21 times less risky than Regeneron Pharmaceuticals. It trades about 0.04 of its potential returns per unit of risk. Regeneron Pharmaceuticals is currently generating about 0.01 per unit of risk. If you would invest  13,673  in Zoetis Inc Cl on April 3, 2022 and sell it today you would earn a total of  3,748  from holding Zoetis Inc Cl or generate 27.41% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy99.8%
ValuesDaily Returns

Zoetis Inc Cl  vs.  Regeneron Pharmaceuticals

 Performance (%) 
      Timeline 
Zoetis Inc Cl 
Zoetis Performance
0 of 100
Over the last 90 days Zoetis Inc Cl has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0075
Payout Ratio
0.26
Forward Annual Dividend Rate
1.3
Dividend Date
2022-09-01
Ex Dividend Date
2022-07-20

Zoetis Price Channel

Regeneron Pharmaceuticals 
Regeneron Performance
0 of 100
Over the last 90 days Regeneron Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in August 2022. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Regeneron Price Channel

Zoetis Inc and Regeneron Pharmaceuticals Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Zoetis Inc and Regeneron Pharmaceuticals

The main advantage of trading using opposite Zoetis Inc and Regeneron Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoetis Inc 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 Zoetis Inc Cl 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 Transaction History module to view history of all your transactions and understand their impact on performance.

Other Complementary Tools

Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Go
Fundamental Analysis
View fundamental data based on most recent published financial statements
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Go
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Go
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Go
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
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
Price Transformation
Use Price Transformation models to analyze depth of different equity instruments across global markets
Go
Equity Valuation
Check real value of public entities based on technical and fundamental data
Go
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Go
Transaction History
View history of all your transactions and understand their impact on performance
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