Correlation Between Regeneron Pharmaceuticals and Chimerix

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

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

Diversification Opportunities for Regeneron Pharmaceuticals and Chimerix

0.66

Correlation Coefficient

Regeneron Pharmaceuticals  Chimerix

Poor diversification

The 3 months correlation between Regeneron and Chimerix is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Regeneron Pharmaceuticals and Chimerix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chimerix and Regeneron Pharmaceuticals 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 Regeneron Pharmaceuticals are associated (or correlated) with Chimerix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chimerix has no effect on the direction of Regeneron Pharmaceuticals i.e., Regeneron Pharmaceuticals and Chimerix go up and down completely randomly.

Pair Corralation between Regeneron Pharmaceuticals and Chimerix

Given the investment horizon of 90 days Regeneron Pharmaceuticals is expected to generate 0.31 times more return on investment than Chimerix. However, Regeneron Pharmaceuticals is 3.19 times less risky than Chimerix. It trades about 0.04 of its potential returns per unit of risk. Chimerix is currently generating about -0.09 per unit of risk. If you would invest  94,687  in Regeneron Pharmaceuticals on February 17, 2024 and sell it today you would earn a total of  2,111  from holding Regeneron Pharmaceuticals or generate 2.23% return on investment over 90 days.

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

Regeneron Pharmaceuticals  vs.  Chimerix

Regeneron Pharmaceuticals

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Regeneron Pharmaceuticals are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Regeneron Pharmaceuticals is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

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 weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Regeneron Pharmaceuticals and Chimerix

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

The idea behind Regeneron Pharmaceuticals and Chimerix 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.