Correlation Between AusCann Group and Aspen Pharmacare
Can any of the company-specific risk be diversified away by investing in both AusCann Group and Aspen Pharmacare 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 AusCann Group and Aspen Pharmacare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AusCann Group Holdings and Aspen Pharmacare Holdings, you can compare the effects of market volatilities on AusCann Group and Aspen Pharmacare 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 AusCann Group with a short position of Aspen Pharmacare. Check out your portfolio center. Please also check ongoing floating volatility patterns of AusCann Group and Aspen Pharmacare.
Diversification Opportunities for AusCann Group and Aspen Pharmacare
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AusCann and Aspen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AusCann Group Holdings and Aspen Pharmacare Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Pharmacare Holdings and AusCann Group 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 AusCann Group Holdings are associated (or correlated) with Aspen Pharmacare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Pharmacare Holdings has no effect on the direction of AusCann Group i.e., AusCann Group and Aspen Pharmacare go up and down completely randomly.
Pair Corralation between AusCann Group and Aspen Pharmacare
Assuming the 90 days horizon AusCann Group Holdings is expected to generate 10.68 times more return on investment than Aspen Pharmacare. However, AusCann Group is 10.68 times more volatile than Aspen Pharmacare Holdings. It trades about 0.17 of its potential returns per unit of risk. Aspen Pharmacare Holdings is currently generating about 0.05 per unit of risk. If you would invest 0.25 in AusCann Group Holdings on October 23, 2024 and sell it today you would earn a total of 0.13 from holding AusCann Group Holdings or generate 52.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 91.58% |
| Values | Daily Returns |
AusCann Group Holdings vs. Aspen Pharmacare Holdings
Performance |
| Timeline |
| AusCann Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aspen Pharmacare Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AusCann Group and Aspen Pharmacare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AusCann Group and Aspen Pharmacare
The main advantage of trading using opposite AusCann Group and Aspen Pharmacare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AusCann Group position performs unexpectedly, Aspen Pharmacare 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 Aspen Pharmacare will offset losses from the drop in Aspen Pharmacare's long position.| AusCann Group vs. Amexdrug | AusCann Group vs. Aion Therapeutic | AusCann Group vs. Alterola Biotech | AusCann Group vs. The BC Bud |
| Aspen Pharmacare vs. Amexdrug | Aspen Pharmacare vs. Aion Therapeutic | Aspen Pharmacare vs. Alterola Biotech | Aspen Pharmacare vs. The BC Bud |
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 the Global Correlations module to find global opportunities by holding instruments from different markets.
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