Correlation Between Elite Pharma and Amarantus Bioscience
Can any of the company-specific risk be diversified away by investing in both Elite Pharma and Amarantus Bioscience 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 Elite Pharma and Amarantus Bioscience into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elite Pharma and Amarantus Bioscience Holdings, you can compare the effects of market volatilities on Elite Pharma and Amarantus Bioscience 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 Elite Pharma with a short position of Amarantus Bioscience. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elite Pharma and Amarantus Bioscience.
Diversification Opportunities for Elite Pharma and Amarantus Bioscience
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Elite and Amarantus is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Elite Pharma and Amarantus Bioscience Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amarantus Bioscience and Elite Pharma 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 Elite Pharma are associated (or correlated) with Amarantus Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amarantus Bioscience has no effect on the direction of Elite Pharma i.e., Elite Pharma and Amarantus Bioscience go up and down completely randomly.
Pair Corralation between Elite Pharma and Amarantus Bioscience
If you would invest 0.03 in Amarantus Bioscience Holdings on August 28, 2024 and sell it today you would lose (0.02) from holding Amarantus Bioscience Holdings or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.48% |
| Values | Daily Returns |
Elite Pharma vs. Amarantus Bioscience Holdings
Performance |
| Timeline |
| Elite Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Amarantus Bioscience |
Elite Pharma and Amarantus Bioscience Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elite Pharma and Amarantus Bioscience
The main advantage of trading using opposite Elite Pharma and Amarantus Bioscience positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elite Pharma position performs unexpectedly, Amarantus Bioscience 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 Amarantus Bioscience will offset losses from the drop in Amarantus Bioscience's long position.| Elite Pharma vs. Amarantus Bioscience Holdings | Elite Pharma vs. Intelgenx Technologs | Elite Pharma vs. Cytosorbents Crp |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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