Correlation Between GlaxoSmithKline PLC and Altamira Therapeutics
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Altamira Therapeutics 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 GlaxoSmithKline PLC and Altamira Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Altamira Therapeutics, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Altamira Therapeutics 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 GlaxoSmithKline PLC with a short position of Altamira Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Altamira Therapeutics.
Diversification Opportunities for GlaxoSmithKline PLC and Altamira Therapeutics
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between GlaxoSmithKline and Altamira is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Altamira Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altamira Therapeutics and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with Altamira Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altamira Therapeutics has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Altamira Therapeutics go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Altamira Therapeutics
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to generate 0.28 times more return on investment than Altamira Therapeutics. However, GlaxoSmithKline PLC ADR is 3.63 times less risky than Altamira Therapeutics. It trades about -0.23 of its potential returns per unit of risk. Altamira Therapeutics is currently generating about -0.16 per unit of risk. If you would invest 3,659 in GlaxoSmithKline PLC ADR on August 31, 2024 and sell it today you would lose (226.00) from holding GlaxoSmithKline PLC ADR or give up 6.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Altamira Therapeutics
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Altamira Therapeutics |
GlaxoSmithKline PLC and Altamira Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Altamira Therapeutics
The main advantage of trading using opposite GlaxoSmithKline PLC and Altamira Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Altamira Therapeutics 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 Altamira Therapeutics will offset losses from the drop in Altamira Therapeutics' long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
| Altamira Therapeutics vs. Pyxis Oncology | Altamira Therapeutics vs. Zura Bio Limited | Altamira Therapeutics vs. Elevation Oncology | Altamira Therapeutics vs. Immix Biopharma |
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 Stocks Directory module to find actively traded stocks across global markets.
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