Correlation Between Aspen Insurance and Guardian Pharmacy
Can any of the company-specific risk be diversified away by investing in both Aspen Insurance and Guardian Pharmacy 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 Aspen Insurance and Guardian Pharmacy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Insurance Holdings and Guardian Pharmacy Services,, you can compare the effects of market volatilities on Aspen Insurance and Guardian Pharmacy 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 Aspen Insurance with a short position of Guardian Pharmacy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Insurance and Guardian Pharmacy.
Diversification Opportunities for Aspen Insurance and Guardian Pharmacy
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aspen and Guardian is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Insurance Holdings and Guardian Pharmacy Services, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Pharmacy and Aspen Insurance 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 Aspen Insurance Holdings are associated (or correlated) with Guardian Pharmacy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Pharmacy has no effect on the direction of Aspen Insurance i.e., Aspen Insurance and Guardian Pharmacy go up and down completely randomly.
Pair Corralation between Aspen Insurance and Guardian Pharmacy
Assuming the 90 days trading horizon Aspen Insurance is expected to generate 14.84 times less return on investment than Guardian Pharmacy. But when comparing it to its historical volatility, Aspen Insurance Holdings is 2.48 times less risky than Guardian Pharmacy. It trades about 0.04 of its potential returns per unit of risk. Guardian Pharmacy Services, is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,600 in Guardian Pharmacy Services, on September 4, 2024 and sell it today you would earn a total of 828.00 from holding Guardian Pharmacy Services, or generate 51.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 9.7% |
| Values | Daily Returns |
Aspen Insurance Holdings vs. Guardian Pharmacy Services,
Performance |
| Timeline |
| Aspen Insurance Holdings |
| Guardian Pharmacy |
Aspen Insurance and Guardian Pharmacy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Insurance and Guardian Pharmacy
The main advantage of trading using opposite Aspen Insurance and Guardian Pharmacy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Insurance position performs unexpectedly, Guardian Pharmacy 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 Guardian Pharmacy will offset losses from the drop in Guardian Pharmacy's long position.| Aspen Insurance vs. Aspen Insurance Holdings | Aspen Insurance vs. Selective Insurance Group | Aspen Insurance vs. The Allstate | Aspen Insurance vs. AmTrust Financial Services |
| Guardian Pharmacy vs. Teleflex Incorporated | Guardian Pharmacy vs. enVVeno Medical Corp | Guardian Pharmacy vs. Barrick Gold Corp | Guardian Pharmacy vs. Verra Mobility Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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