Correlation Between Hasbro and Alvotech
Can any of the company-specific risk be diversified away by investing in both Hasbro and Alvotech 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 Hasbro and Alvotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and Alvotech, you can compare the effects of market volatilities on Hasbro and Alvotech 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 Hasbro with a short position of Alvotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and Alvotech.
Diversification Opportunities for Hasbro and Alvotech
Good diversification
The 3 months correlation between Hasbro and Alvotech is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and Alvotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech and Hasbro 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 Hasbro Inc are associated (or correlated) with Alvotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech has no effect on the direction of Hasbro i.e., Hasbro and Alvotech go up and down completely randomly.
Pair Corralation between Hasbro and Alvotech
Considering the 90-day investment horizon Hasbro Inc is expected to under-perform the Alvotech. But the stock apears to be less risky and, when comparing its historical volatility, Hasbro Inc is 1.14 times less risky than Alvotech. The stock trades about -0.01 of its potential returns per unit of risk. The Alvotech is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,080 in Alvotech on September 12, 2024 and sell it today you would earn a total of 69.00 from holding Alvotech or generate 6.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hasbro Inc vs. Alvotech
Performance |
| Timeline |
| Hasbro Inc |
| Alvotech |
Hasbro and Alvotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hasbro and Alvotech
The main advantage of trading using opposite Hasbro and Alvotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, Alvotech 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 Alvotech will offset losses from the drop in Alvotech's long position.The idea behind Hasbro Inc and Alvotech pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Alvotech vs. Evoke Pharma | Alvotech vs. Dynavax Technologies | Alvotech vs. Amphastar P | Alvotech vs. Lantheus 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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