Correlation Between Agilent Technologies and Regencell Bioscience

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

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

Diversification Opportunities for Agilent Technologies and Regencell Bioscience

-0.73

Correlation Coefficient

Agilent Technologies  Regencell Bioscience

Pay attention - limited upside

The 3 months correlation between Agilent and Regencell is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Regencell Bioscience Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regencell Bioscience and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Regencell Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regencell Bioscience has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Regencell Bioscience go up and down completely randomly.

Pair Corralation between Agilent Technologies and Regencell Bioscience

Taking into account the 90-day investment horizon Agilent Technologies is expected to under-perform the Regencell Bioscience. But the stock apears to be less risky and, when comparing its historical volatility, Agilent Technologies is 6.75 times less risky than Regencell Bioscience. The stock trades about -0.05 of its potential returns per unit of risk. The Regencell Bioscience Holdings is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  390.00  in Regencell Bioscience Holdings on February 7, 2024 and sell it today you would earn a total of  208.00  from holding Regencell Bioscience Holdings or generate 53.33% return on investment over 90 days.

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

Agilent Technologies  vs.  Regencell Bioscience Holdings

Agilent Technologies

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Agilent Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Agilent Technologies may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Regencell Bioscience

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Regencell Bioscience Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Regencell Bioscience is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Agilent Technologies and Regencell Bioscience

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

The idea behind Agilent Technologies and Regencell Bioscience Holdings 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.