Correlation Between ANI Pharmaceuticals and ELMOS SEMICONDUCTOR
Can any of the company-specific risk be diversified away by investing in both ANI Pharmaceuticals and ELMOS SEMICONDUCTOR 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 ANI Pharmaceuticals and ELMOS SEMICONDUCTOR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANI Pharmaceuticals and ELMOS SEMICONDUCTOR, you can compare the effects of market volatilities on ANI Pharmaceuticals and ELMOS SEMICONDUCTOR 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 ANI Pharmaceuticals with a short position of ELMOS SEMICONDUCTOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANI Pharmaceuticals and ELMOS SEMICONDUCTOR.
Diversification Opportunities for ANI Pharmaceuticals and ELMOS SEMICONDUCTOR
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between ANI and ELMOS is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding ANI Pharmaceuticals and ELMOS SEMICONDUCTOR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELMOS SEMICONDUCTOR and ANI Pharmaceuticals 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 ANI Pharmaceuticals are associated (or correlated) with ELMOS SEMICONDUCTOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELMOS SEMICONDUCTOR has no effect on the direction of ANI Pharmaceuticals i.e., ANI Pharmaceuticals and ELMOS SEMICONDUCTOR go up and down completely randomly.
Pair Corralation between ANI Pharmaceuticals and ELMOS SEMICONDUCTOR
Assuming the 90 days trading horizon ANI Pharmaceuticals is expected to generate 1.18 times less return on investment than ELMOS SEMICONDUCTOR. But when comparing it to its historical volatility, ANI Pharmaceuticals is 2.0 times less risky than ELMOS SEMICONDUCTOR. It trades about 0.09 of its potential returns per unit of risk. ELMOS SEMICONDUCTOR is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5,750 in ELMOS SEMICONDUCTOR on September 5, 2024 and sell it today you would earn a total of 190.00 from holding ELMOS SEMICONDUCTOR or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANI Pharmaceuticals vs. ELMOS SEMICONDUCTOR
Performance |
| Timeline |
| ANI Pharmaceuticals |
| ELMOS SEMICONDUCTOR |
ANI Pharmaceuticals and ELMOS SEMICONDUCTOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANI Pharmaceuticals and ELMOS SEMICONDUCTOR
The main advantage of trading using opposite ANI Pharmaceuticals and ELMOS SEMICONDUCTOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANI Pharmaceuticals position performs unexpectedly, ELMOS SEMICONDUCTOR 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 ELMOS SEMICONDUCTOR will offset losses from the drop in ELMOS SEMICONDUCTOR's long position.| ANI Pharmaceuticals vs. COMINTL BANK ADR1 | ANI Pharmaceuticals vs. BE Semiconductor Industries | ANI Pharmaceuticals vs. Webster Financial | ANI Pharmaceuticals vs. TOREX SEMICONDUCTOR LTD |
| ELMOS SEMICONDUCTOR vs. TOTAL GABON | ELMOS SEMICONDUCTOR vs. Walgreens Boots Alliance | ELMOS SEMICONDUCTOR vs. Peak Resources Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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