Correlation Between Amphastar and Cronos
Can any of the company-specific risk be diversified away by investing in both Amphastar and Cronos 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 Amphastar and Cronos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amphastar P and Cronos Group, you can compare the effects of market volatilities on Amphastar and Cronos 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 Amphastar with a short position of Cronos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amphastar and Cronos.
Diversification Opportunities for Amphastar and Cronos
Modest diversification
The 3 months correlation between Amphastar and Cronos is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Amphastar P and Cronos Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cronos Group and Amphastar 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 Amphastar P are associated (or correlated) with Cronos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cronos Group has no effect on the direction of Amphastar i.e., Amphastar and Cronos go up and down completely randomly.
Pair Corralation between Amphastar and Cronos
Given the investment horizon of 90 days Amphastar is expected to generate 3.81 times less return on investment than Cronos. But when comparing it to its historical volatility, Amphastar P is 1.43 times less risky than Cronos. It trades about 0.01 of its potential returns per unit of risk. Cronos Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 208.00 in Cronos Group on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Cronos Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amphastar P vs. Cronos Group
Performance |
| Timeline |
| Amphastar P |
| Cronos Group |
Amphastar and Cronos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amphastar and Cronos
The main advantage of trading using opposite Amphastar and Cronos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amphastar position performs unexpectedly, Cronos 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 Cronos will offset losses from the drop in Cronos' long position.| Amphastar vs. Collegium Pharmaceutical | Amphastar vs. Alkermes Plc | Amphastar vs. Evolus Inc | Amphastar vs. Neurocrine Biosciences |
| Cronos vs. OrganiGram Holdings | Cronos vs. Aurora Cannabis | Cronos vs. SNDL Inc | Cronos vs. Canopy Growth 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Correlations Find global opportunities by holding instruments from different markets |