Correlation Between Astellas Pharma and Daiichi Sankyo
Can any of the company-specific risk be diversified away by investing in both Astellas Pharma and Daiichi Sankyo 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 Astellas Pharma and Daiichi Sankyo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astellas Pharma and Daiichi Sankyo, you can compare the effects of market volatilities on Astellas Pharma and Daiichi Sankyo 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 Astellas Pharma with a short position of Daiichi Sankyo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astellas Pharma and Daiichi Sankyo.
Diversification Opportunities for Astellas Pharma and Daiichi Sankyo
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Astellas and Daiichi is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Astellas Pharma and Daiichi Sankyo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daiichi Sankyo and Astellas Pharma 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 Astellas Pharma are associated (or correlated) with Daiichi Sankyo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daiichi Sankyo has no effect on the direction of Astellas Pharma i.e., Astellas Pharma and Daiichi Sankyo go up and down completely randomly.
Pair Corralation between Astellas Pharma and Daiichi Sankyo
Assuming the 90 days horizon Astellas Pharma is expected to generate 0.38 times more return on investment than Daiichi Sankyo. However, Astellas Pharma is 2.64 times less risky than Daiichi Sankyo. It trades about 0.08 of its potential returns per unit of risk. Daiichi Sankyo is currently generating about -0.11 per unit of risk. If you would invest 954.00 in Astellas Pharma on November 18, 2024 and sell it today you would earn a total of 23.00 from holding Astellas Pharma or generate 2.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astellas Pharma vs. Daiichi Sankyo
Performance |
| Timeline |
| Astellas Pharma |
| Daiichi Sankyo |
Astellas Pharma and Daiichi Sankyo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astellas Pharma and Daiichi Sankyo
The main advantage of trading using opposite Astellas Pharma and Daiichi Sankyo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astellas Pharma position performs unexpectedly, Daiichi Sankyo 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 Daiichi Sankyo will offset losses from the drop in Daiichi Sankyo's long position.| Astellas Pharma vs. Bristol Myers Squibb | Astellas Pharma vs. Bayer AG | Astellas Pharma vs. Daiichi Sankyo | Astellas Pharma vs. AstraZeneca PLC |
| Daiichi Sankyo vs. Astellas Pharma | Daiichi Sankyo vs. Bristol Myers Squibb | Daiichi Sankyo vs. Bayer AG | Daiichi Sankyo vs. AstraZeneca PLC |
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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |