Correlation Between Aquestive Therapeutics and OFX Group
Can any of the company-specific risk be diversified away by investing in both Aquestive Therapeutics and OFX Group 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 Aquestive Therapeutics and OFX Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquestive Therapeutics and OFX Group Ltd, you can compare the effects of market volatilities on Aquestive Therapeutics and OFX Group 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 Aquestive Therapeutics with a short position of OFX Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquestive Therapeutics and OFX Group.
Diversification Opportunities for Aquestive Therapeutics and OFX Group
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aquestive and OFX is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Aquestive Therapeutics and OFX Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFX Group and Aquestive Therapeutics 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 Aquestive Therapeutics are associated (or correlated) with OFX Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFX Group has no effect on the direction of Aquestive Therapeutics i.e., Aquestive Therapeutics and OFX Group go up and down completely randomly.
Pair Corralation between Aquestive Therapeutics and OFX Group
Given the investment horizon of 90 days Aquestive Therapeutics is expected to generate 1.28 times more return on investment than OFX Group. However, Aquestive Therapeutics is 1.28 times more volatile than OFX Group Ltd. It trades about 0.1 of its potential returns per unit of risk. OFX Group Ltd is currently generating about 0.06 per unit of risk. If you would invest 151.00 in Aquestive Therapeutics on August 25, 2024 and sell it today you would earn a total of 305.00 from holding Aquestive Therapeutics or generate 201.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Aquestive Therapeutics vs. OFX Group Ltd
Performance |
| Timeline |
| Aquestive Therapeutics |
| OFX Group |
Aquestive Therapeutics and OFX Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquestive Therapeutics and OFX Group
The main advantage of trading using opposite Aquestive Therapeutics and OFX Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquestive Therapeutics position performs unexpectedly, OFX Group 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 OFX Group will offset losses from the drop in OFX Group's long position.| Aquestive Therapeutics vs. Capricor Therapeutics | Aquestive Therapeutics vs. Akari Therapeutics PLC | Aquestive Therapeutics vs. Soleno Therapeutics | Aquestive Therapeutics vs. Bio Path Holdings |
| OFX Group vs. Microbot Medical | OFX Group vs. FactSet Research Systems | OFX Group vs. Tandem Diabetes Care | OFX Group vs. Aquestive Therapeutics |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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