Correlation Between Alcon AG and AptarGroup
Can any of the company-specific risk be diversified away by investing in both Alcon AG and AptarGroup 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 Alcon AG and AptarGroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alcon AG and AptarGroup, you can compare the effects of market volatilities on Alcon AG and AptarGroup 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 Alcon AG with a short position of AptarGroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcon AG and AptarGroup.
Diversification Opportunities for Alcon AG and AptarGroup
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Alcon and AptarGroup is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Alcon AG and AptarGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptarGroup and Alcon AG 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 Alcon AG are associated (or correlated) with AptarGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AptarGroup has no effect on the direction of Alcon AG i.e., Alcon AG and AptarGroup go up and down completely randomly.
Pair Corralation between Alcon AG and AptarGroup
Considering the 90-day investment horizon Alcon AG is expected to under-perform the AptarGroup. In addition to that, Alcon AG is 1.22 times more volatile than AptarGroup. It trades about -0.29 of its total potential returns per unit of risk. AptarGroup is currently generating about 0.06 per unit of volatility. If you would invest 16,720 in AptarGroup on August 24, 2024 and sell it today you would earn a total of 268.00 from holding AptarGroup or generate 1.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alcon AG vs. AptarGroup
Performance |
| Timeline |
| Alcon AG |
| AptarGroup |
Alcon AG and AptarGroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcon AG and AptarGroup
The main advantage of trading using opposite Alcon AG and AptarGroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcon AG position performs unexpectedly, AptarGroup 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 AptarGroup will offset losses from the drop in AptarGroup's long position.| Alcon AG vs. Teleflex Incorporated | Alcon AG vs. West Pharmaceutical Services | Alcon AG vs. ResMed Inc | Alcon AG vs. ICU Medical |
| AptarGroup vs. Haemonetics | AptarGroup vs. Merit Medical Systems | AptarGroup vs. AngioDynamics | AptarGroup vs. Envista Holdings 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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