Correlation Between Hafnia and Amgen
Can any of the company-specific risk be diversified away by investing in both Hafnia and Amgen 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 Hafnia and Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hafnia Limited and Amgen Inc, you can compare the effects of market volatilities on Hafnia and Amgen 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 Hafnia with a short position of Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and Amgen.
Diversification Opportunities for Hafnia and Amgen
Poor diversification
The 3 months correlation between Hafnia and Amgen is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc and Hafnia 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 Hafnia Limited are associated (or correlated) with Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Hafnia i.e., Hafnia and Amgen go up and down completely randomly.
Pair Corralation between Hafnia and Amgen
Given the investment horizon of 90 days Hafnia Limited is expected to generate 1.13 times more return on investment than Amgen. However, Hafnia is 1.13 times more volatile than Amgen Inc. It trades about 0.01 of its potential returns per unit of risk. Amgen Inc is currently generating about -0.25 per unit of risk. If you would invest 569.00 in Hafnia Limited on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Hafnia Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hafnia Limited vs. Amgen Inc
Performance |
| Timeline |
| Hafnia Limited |
| Amgen Inc |
Hafnia and Amgen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hafnia and Amgen
The main advantage of trading using opposite Hafnia and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.| Hafnia vs. Triton International Limited | Hafnia vs. Avis Budget Group | Hafnia vs. Videolocity International | Hafnia vs. Xponential Fitness |
| Amgen vs. Pfizer Inc | Amgen vs. Johnson Johnson | Amgen vs. Highway Holdings Limited | Amgen vs. QCR Holdings |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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