Correlation Between Aquagold International and Hikma Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Aquagold International and Hikma Pharmaceuticals 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 Aquagold International and Hikma Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and Hikma Pharmaceuticals PLC, you can compare the effects of market volatilities on Aquagold International and Hikma Pharmaceuticals 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 Aquagold International with a short position of Hikma Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and Hikma Pharmaceuticals.
Diversification Opportunities for Aquagold International and Hikma Pharmaceuticals
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aquagold and Hikma is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Hikma Pharmaceuticals PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hikma Pharmaceuticals PLC and Aquagold International 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 Aquagold International are associated (or correlated) with Hikma Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hikma Pharmaceuticals PLC has no effect on the direction of Aquagold International i.e., Aquagold International and Hikma Pharmaceuticals go up and down completely randomly.
Pair Corralation between Aquagold International and Hikma Pharmaceuticals
Given the investment horizon of 90 days Aquagold International is expected to under-perform the Hikma Pharmaceuticals. In addition to that, Aquagold International is 5.64 times more volatile than Hikma Pharmaceuticals PLC. It trades about -0.1 of its total potential returns per unit of risk. Hikma Pharmaceuticals PLC is currently generating about 0.06 per unit of volatility. If you would invest 5,318 in Hikma Pharmaceuticals PLC on November 2, 2024 and sell it today you would earn a total of 439.00 from holding Hikma Pharmaceuticals PLC or generate 8.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.05% |
| Values | Daily Returns |
Aquagold International vs. Hikma Pharmaceuticals PLC
Performance |
| Timeline |
| Aquagold International |
| Hikma Pharmaceuticals PLC |
Aquagold International and Hikma Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquagold International and Hikma Pharmaceuticals
The main advantage of trading using opposite Aquagold International and Hikma Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, Hikma Pharmaceuticals 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 Hikma Pharmaceuticals will offset losses from the drop in Hikma Pharmaceuticals' long position.| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
| Hikma Pharmaceuticals vs. Viatris | Hikma Pharmaceuticals vs. Bausch Health Companies | Hikma Pharmaceuticals vs. Tilray Inc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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