Correlation Between Aquestive Therapeutics and Pinstripes Holdings
Can any of the company-specific risk be diversified away by investing in both Aquestive Therapeutics and Pinstripes Holdings 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 Pinstripes Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquestive Therapeutics and Pinstripes Holdings, you can compare the effects of market volatilities on Aquestive Therapeutics and Pinstripes Holdings 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 Pinstripes Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquestive Therapeutics and Pinstripes Holdings.
Diversification Opportunities for Aquestive Therapeutics and Pinstripes Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aquestive and Pinstripes is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Aquestive Therapeutics and Pinstripes Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinstripes Holdings 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 Pinstripes Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinstripes Holdings has no effect on the direction of Aquestive Therapeutics i.e., Aquestive Therapeutics and Pinstripes Holdings go up and down completely randomly.
Pair Corralation between Aquestive Therapeutics and Pinstripes Holdings
Given the investment horizon of 90 days Aquestive Therapeutics is expected to generate 0.46 times more return on investment than Pinstripes Holdings. However, Aquestive Therapeutics is 2.16 times less risky than Pinstripes Holdings. It trades about 0.09 of its potential returns per unit of risk. Pinstripes Holdings is currently generating about -0.14 per unit of risk. If you would invest 419.00 in Aquestive Therapeutics on September 2, 2024 and sell it today you would earn a total of 90.00 from holding Aquestive Therapeutics or generate 21.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aquestive Therapeutics vs. Pinstripes Holdings
Performance |
| Timeline |
| Aquestive Therapeutics |
| Pinstripes Holdings |
Aquestive Therapeutics and Pinstripes Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquestive Therapeutics and Pinstripes Holdings
The main advantage of trading using opposite Aquestive Therapeutics and Pinstripes Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquestive Therapeutics position performs unexpectedly, Pinstripes Holdings 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 Pinstripes Holdings will offset losses from the drop in Pinstripes Holdings' long position.| Aquestive Therapeutics vs. Evoke Pharma | Aquestive Therapeutics vs. Dynavax Technologies | Aquestive Therapeutics vs. Amphastar P | Aquestive Therapeutics vs. Lantheus Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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