Correlation Between ANI Pharmaceuticals and Phibro Animal
Can any of the company-specific risk be diversified away by investing in both ANI Pharmaceuticals and Phibro Animal 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 ANI Pharmaceuticals and Phibro Animal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANI Pharmaceuticals and Phibro Animal Health, you can compare the effects of market volatilities on ANI Pharmaceuticals and Phibro Animal 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 ANI Pharmaceuticals with a short position of Phibro Animal. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANI Pharmaceuticals and Phibro Animal.
Diversification Opportunities for ANI Pharmaceuticals and Phibro Animal
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between ANI and Phibro is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding ANI Pharmaceuticals and Phibro Animal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phibro Animal Health and ANI Pharmaceuticals 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 ANI Pharmaceuticals are associated (or correlated) with Phibro Animal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phibro Animal Health has no effect on the direction of ANI Pharmaceuticals i.e., ANI Pharmaceuticals and Phibro Animal go up and down completely randomly.
Pair Corralation between ANI Pharmaceuticals and Phibro Animal
Given the investment horizon of 90 days ANI Pharmaceuticals is expected to under-perform the Phibro Animal. But the stock apears to be less risky and, when comparing its historical volatility, ANI Pharmaceuticals is 1.52 times less risky than Phibro Animal. The stock trades about -0.03 of its potential returns per unit of risk. The Phibro Animal Health is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,265 in Phibro Animal Health on August 27, 2024 and sell it today you would earn a total of 1,109 from holding Phibro Animal Health or generate 87.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANI Pharmaceuticals vs. Phibro Animal Health
Performance |
| Timeline |
| ANI Pharmaceuticals |
| Phibro Animal Health |
ANI Pharmaceuticals and Phibro Animal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANI Pharmaceuticals and Phibro Animal
The main advantage of trading using opposite ANI Pharmaceuticals and Phibro Animal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANI Pharmaceuticals position performs unexpectedly, Phibro Animal 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 Phibro Animal will offset losses from the drop in Phibro Animal's long position.| ANI Pharmaceuticals vs. Phibro Animal Health | ANI Pharmaceuticals vs. Prestige Brand Holdings | ANI Pharmaceuticals vs. Alkermes Plc | ANI Pharmaceuticals vs. Dr Reddys Laboratories |
| Phibro Animal vs. Pacira BioSciences, | Phibro Animal vs. Dr Reddys Laboratories | Phibro Animal vs. Collegium Pharmaceutical | Phibro Animal vs. ANI Pharmaceuticals |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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