Correlation Between Amgen and Aquafil SpA
Can any of the company-specific risk be diversified away by investing in both Amgen and Aquafil SpA 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 Amgen and Aquafil SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amgen Inc and Aquafil SpA, you can compare the effects of market volatilities on Amgen and Aquafil SpA 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 Amgen with a short position of Aquafil SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amgen and Aquafil SpA.
Diversification Opportunities for Amgen and Aquafil SpA
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amgen and Aquafil is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Amgen Inc and Aquafil SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquafil SpA and Amgen 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 Amgen Inc are associated (or correlated) with Aquafil SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquafil SpA has no effect on the direction of Amgen i.e., Amgen and Aquafil SpA go up and down completely randomly.
Pair Corralation between Amgen and Aquafil SpA
Given the investment horizon of 90 days Amgen Inc is expected to generate 0.3 times more return on investment than Aquafil SpA. However, Amgen Inc is 3.32 times less risky than Aquafil SpA. It trades about -0.12 of its potential returns per unit of risk. Aquafil SpA is currently generating about -0.22 per unit of risk. If you would invest 32,011 in Amgen Inc on August 28, 2024 and sell it today you would lose (2,611) from holding Amgen Inc or give up 8.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amgen Inc vs. Aquafil SpA
Performance |
| Timeline |
| Amgen Inc |
| Aquafil SpA |
Amgen and Aquafil SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amgen and Aquafil SpA
The main advantage of trading using opposite Amgen and Aquafil SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amgen position performs unexpectedly, Aquafil SpA 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 Aquafil SpA will offset losses from the drop in Aquafil SpA's long position.| Amgen vs. Eliem Therapeutics | Amgen vs. HCW Biologics | Amgen vs. Scpharmaceuticals | Amgen vs. Milestone Pharmaceuticals |
| Aquafil SpA vs. Unifi Inc | Aquafil SpA vs. Albany International | Aquafil SpA vs. Sumitomo Electric Industries | Aquafil SpA vs. Sekisui House |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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