Correlation Between Alvotech and Hafnia
Can any of the company-specific risk be diversified away by investing in both Alvotech and Hafnia 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 Alvotech and Hafnia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alvotech and Hafnia Limited, you can compare the effects of market volatilities on Alvotech and Hafnia 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 Alvotech with a short position of Hafnia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alvotech and Hafnia.
Diversification Opportunities for Alvotech and Hafnia
Very good diversification
The 3 months correlation between Alvotech and Hafnia is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Alvotech and Hafnia Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hafnia Limited and Alvotech 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 Alvotech are associated (or correlated) with Hafnia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hafnia Limited has no effect on the direction of Alvotech i.e., Alvotech and Hafnia go up and down completely randomly.
Pair Corralation between Alvotech and Hafnia
Given the investment horizon of 90 days Alvotech is expected to generate 3.48 times less return on investment than Hafnia. In addition to that, Alvotech is 1.06 times more volatile than Hafnia Limited. It trades about 0.01 of its total potential returns per unit of risk. Hafnia Limited is currently generating about 0.05 per unit of volatility. If you would invest 398.00 in Hafnia Limited on September 3, 2024 and sell it today you would earn a total of 165.00 from holding Hafnia Limited or generate 41.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 81.89% |
| Values | Daily Returns |
Alvotech vs. Hafnia Limited
Performance |
| Timeline |
| Alvotech |
| Hafnia Limited |
Alvotech and Hafnia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alvotech and Hafnia
The main advantage of trading using opposite Alvotech and Hafnia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alvotech position performs unexpectedly, Hafnia 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 Hafnia will offset losses from the drop in Hafnia's long position.| Alvotech vs. Intracellular Th | Alvotech vs. Catalent | Alvotech vs. Amphastar P | Alvotech vs. Assertio Therapeutics |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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