Correlation Between Concert Pharmaceuticals and Aspen Insurance
Can any of the company-specific risk be diversified away by investing in both Concert Pharmaceuticals and Aspen Insurance 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 Concert Pharmaceuticals and Aspen Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concert Pharmaceuticals and Aspen Insurance Holdings, you can compare the effects of market volatilities on Concert Pharmaceuticals and Aspen Insurance 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 Concert Pharmaceuticals with a short position of Aspen Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concert Pharmaceuticals and Aspen Insurance.
Diversification Opportunities for Concert Pharmaceuticals and Aspen Insurance
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Concert and Aspen is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Concert Pharmaceuticals and Aspen Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Insurance Holdings and Concert 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 Concert Pharmaceuticals are associated (or correlated) with Aspen Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Insurance Holdings has no effect on the direction of Concert Pharmaceuticals i.e., Concert Pharmaceuticals and Aspen Insurance go up and down completely randomly.
Pair Corralation between Concert Pharmaceuticals and Aspen Insurance
If you would invest 2,137 in Aspen Insurance Holdings on August 27, 2024 and sell it today you would earn a total of 22.00 from holding Aspen Insurance Holdings or generate 1.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Concert Pharmaceuticals vs. Aspen Insurance Holdings
Performance |
| Timeline |
| Concert Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aspen Insurance Holdings |
Concert Pharmaceuticals and Aspen Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concert Pharmaceuticals and Aspen Insurance
The main advantage of trading using opposite Concert Pharmaceuticals and Aspen Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concert Pharmaceuticals position performs unexpectedly, Aspen Insurance 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 Aspen Insurance will offset losses from the drop in Aspen Insurance's long position.| Concert Pharmaceuticals vs. Aspen Insurance Holdings | Concert Pharmaceuticals vs. RCI Hospitality Holdings | Concert Pharmaceuticals vs. Sun Life Financial | Concert Pharmaceuticals vs. Kinsale Capital Group |
| Aspen Insurance vs. Aspen Insurance Holdings | Aspen Insurance vs. Selective Insurance Group | Aspen Insurance vs. The Allstate | Aspen Insurance vs. AmTrust Financial Services |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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