Correlation Between Athenex and Adamis Pharma
Can any of the company-specific risk be diversified away by investing in both Athenex and Adamis Pharma 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 Athenex and Adamis Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Athenex and Adamis Pharma, you can compare the effects of market volatilities on Athenex and Adamis Pharma 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 Athenex with a short position of Adamis Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athenex and Adamis Pharma.
Diversification Opportunities for Athenex and Adamis Pharma
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Athenex and Adamis is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Athenex and Adamis Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adamis Pharma and Athenex 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 Athenex are associated (or correlated) with Adamis Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adamis Pharma has no effect on the direction of Athenex i.e., Athenex and Adamis Pharma go up and down completely randomly.
Pair Corralation between Athenex and Adamis Pharma
Given the investment horizon of 90 days Athenex is expected to under-perform the Adamis Pharma. In addition to that, Athenex is 3.87 times more volatile than Adamis Pharma. It trades about -0.11 of its total potential returns per unit of risk. Adamis Pharma is currently generating about -0.05 per unit of volatility. If you would invest 204.00 in Adamis Pharma on August 31, 2024 and sell it today you would lose (30.00) from holding Adamis Pharma or give up 14.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athenex vs. Adamis Pharma
Performance |
| Timeline |
| Athenex |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Adamis Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Athenex and Adamis Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Athenex and Adamis Pharma
The main advantage of trading using opposite Athenex and Adamis Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athenex position performs unexpectedly, Adamis Pharma 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 Adamis Pharma will offset losses from the drop in Adamis Pharma's long position.The idea behind Athenex and Adamis Pharma pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Adamis Pharma vs. Lifecore Biomedical | Adamis Pharma vs. Shuttle Pharmaceuticals | Adamis Pharma vs. Organogenesis Holdings | Adamis Pharma vs. Catalent |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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