Correlation Between AptarGroup and Alcon AG
Can any of the company-specific risk be diversified away by investing in both AptarGroup and Alcon AG 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 AptarGroup and Alcon AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptarGroup and Alcon AG, you can compare the effects of market volatilities on AptarGroup and Alcon AG 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 AptarGroup with a short position of Alcon AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptarGroup and Alcon AG.
Diversification Opportunities for AptarGroup and Alcon AG
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AptarGroup and Alcon is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding AptarGroup and Alcon AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alcon AG and AptarGroup 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 AptarGroup are associated (or correlated) with Alcon AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcon AG has no effect on the direction of AptarGroup i.e., AptarGroup and Alcon AG go up and down completely randomly.
Pair Corralation between AptarGroup and Alcon AG
Considering the 90-day investment horizon AptarGroup is expected to generate 0.9 times more return on investment than Alcon AG. However, AptarGroup is 1.11 times less risky than Alcon AG. It trades about -0.01 of its potential returns per unit of risk. Alcon AG is currently generating about -0.08 per unit of risk. If you would invest 15,954 in AptarGroup on October 31, 2024 and sell it today you would lose (243.00) from holding AptarGroup or give up 1.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptarGroup vs. Alcon AG
Performance |
| Timeline |
| AptarGroup |
| Alcon AG |
AptarGroup and Alcon AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptarGroup and Alcon AG
The main advantage of trading using opposite AptarGroup and Alcon AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptarGroup position performs unexpectedly, Alcon AG 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 Alcon AG will offset losses from the drop in Alcon AG's long position.| AptarGroup vs. Haemonetics | AptarGroup vs. Merit Medical Systems | AptarGroup vs. AngioDynamics | AptarGroup vs. Envista Holdings Corp |
| Alcon AG vs. Teleflex Incorporated | Alcon AG vs. West Pharmaceutical Services | Alcon AG vs. ResMed Inc | Alcon AG vs. ICU Medical |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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