Correlation Between Elanco Animal and PetIQ
Can any of the company-specific risk be diversified away by investing in both Elanco Animal and PetIQ 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 Elanco Animal and PetIQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elanco Animal Health and PetIQ Inc, you can compare the effects of market volatilities on Elanco Animal and PetIQ 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 Elanco Animal with a short position of PetIQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elanco Animal and PetIQ.
Diversification Opportunities for Elanco Animal and PetIQ
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Elanco and PetIQ is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Elanco Animal Health and PetIQ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetIQ Inc and Elanco Animal 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 Elanco Animal Health are associated (or correlated) with PetIQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetIQ Inc has no effect on the direction of Elanco Animal i.e., Elanco Animal and PetIQ go up and down completely randomly.
Pair Corralation between Elanco Animal and PetIQ
If you would invest 1,251 in Elanco Animal Health on August 28, 2024 and sell it today you would earn a total of 88.00 from holding Elanco Animal Health or generate 7.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Elanco Animal Health vs. PetIQ Inc
Performance |
| Timeline |
| Elanco Animal Health |
| PetIQ Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Strong
Elanco Animal and PetIQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elanco Animal and PetIQ
The main advantage of trading using opposite Elanco Animal and PetIQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elanco Animal position performs unexpectedly, PetIQ 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 PetIQ will offset losses from the drop in PetIQ's long position.| Elanco Animal vs. Capricor Therapeutics | Elanco Animal vs. Soleno Therapeutics | Elanco Animal vs. Bio Path Holdings | Elanco Animal vs. Moleculin Biotech |
| PetIQ vs. Prestige Brand Holdings | PetIQ vs. Collegium Pharmaceutical | PetIQ vs. Regencell Bioscience Holdings | PetIQ vs. Pacira BioSciences, |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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