Correlation Between Alvotech and Neo Concept
Can any of the company-specific risk be diversified away by investing in both Alvotech and Neo Concept 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 Neo Concept into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alvotech and Neo Concept International Group, you can compare the effects of market volatilities on Alvotech and Neo Concept 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 Neo Concept. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alvotech and Neo Concept.
Diversification Opportunities for Alvotech and Neo Concept
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alvotech and Neo is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Alvotech and Neo Concept International Grou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neo Concept Internat 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 Neo Concept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neo Concept Internat has no effect on the direction of Alvotech i.e., Alvotech and Neo Concept go up and down completely randomly.
Pair Corralation between Alvotech and Neo Concept
Given the investment horizon of 90 days Alvotech is expected to generate 0.18 times more return on investment than Neo Concept. However, Alvotech is 5.49 times less risky than Neo Concept. It trades about 0.03 of its potential returns per unit of risk. Neo Concept International Group is currently generating about -0.06 per unit of risk. If you would invest 985.00 in Alvotech on September 12, 2024 and sell it today you would earn a total of 164.00 from holding Alvotech or generate 16.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 45.74% |
| Values | Daily Returns |
Alvotech vs. Neo Concept International Grou
Performance |
| Timeline |
| Alvotech |
| Neo Concept Internat |
Alvotech and Neo Concept Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alvotech and Neo Concept
The main advantage of trading using opposite Alvotech and Neo Concept positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alvotech position performs unexpectedly, Neo Concept 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 Neo Concept will offset losses from the drop in Neo Concept's long position.| Alvotech vs. Evoke Pharma | Alvotech vs. Dynavax Technologies | Alvotech vs. Amphastar P | Alvotech vs. Lantheus Holdings |
| Neo Concept vs. Skechers USA | Neo Concept vs. CF Industries Holdings | Neo Concept vs. Citi Trends | Neo Concept vs. Chemours Co |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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