Correlation Between Evotec SE and Amphastar
Can any of the company-specific risk be diversified away by investing in both Evotec SE and Amphastar 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 Evotec SE and Amphastar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evotec SE ADR and Amphastar P, you can compare the effects of market volatilities on Evotec SE and Amphastar 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 Evotec SE with a short position of Amphastar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evotec SE and Amphastar.
Diversification Opportunities for Evotec SE and Amphastar
Very good diversification
The 3 months correlation between Evotec and Amphastar is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Evotec SE ADR and Amphastar P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amphastar P and Evotec SE 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 Evotec SE ADR are associated (or correlated) with Amphastar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amphastar P has no effect on the direction of Evotec SE i.e., Evotec SE and Amphastar go up and down completely randomly.
Pair Corralation between Evotec SE and Amphastar
Considering the 90-day investment horizon Evotec SE ADR is expected to under-perform the Amphastar. In addition to that, Evotec SE is 1.49 times more volatile than Amphastar P. It trades about -0.01 of its total potential returns per unit of risk. Amphastar P is currently generating about 0.05 per unit of volatility. If you would invest 2,936 in Amphastar P on August 24, 2024 and sell it today you would earn a total of 1,610 from holding Amphastar P or generate 54.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evotec SE ADR vs. Amphastar P
Performance |
| Timeline |
| Evotec SE ADR |
| Amphastar P |
Evotec SE and Amphastar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evotec SE and Amphastar
The main advantage of trading using opposite Evotec SE and Amphastar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evotec SE position performs unexpectedly, Amphastar 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 Amphastar will offset losses from the drop in Amphastar's long position.| Evotec SE vs. Prestige Brand Holdings | Evotec SE vs. Supernus Pharmaceuticals | Evotec SE vs. Collegium Pharmaceutical | Evotec SE vs. ANI Pharmaceuticals |
| Amphastar vs. Collegium Pharmaceutical | Amphastar vs. Alkermes Plc | Amphastar vs. Evolus Inc | Amphastar vs. Neurocrine 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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