Correlation Between Haleon Plc and Inari Medical
Can any of the company-specific risk be diversified away by investing in both Haleon Plc and Inari Medical 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 Haleon Plc and Inari Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haleon plc and Inari Medical, you can compare the effects of market volatilities on Haleon Plc and Inari Medical 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 Haleon Plc with a short position of Inari Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haleon Plc and Inari Medical.
Diversification Opportunities for Haleon Plc and Inari Medical
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Haleon and Inari is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Haleon plc and Inari Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inari Medical and Haleon 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 Haleon plc are associated (or correlated) with Inari Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inari Medical has no effect on the direction of Haleon Plc i.e., Haleon Plc and Inari Medical go up and down completely randomly.
Pair Corralation between Haleon Plc and Inari Medical
Considering the 90-day investment horizon Haleon plc is expected to generate 0.42 times more return on investment than Inari Medical. However, Haleon plc is 2.38 times less risky than Inari Medical. It trades about 0.05 of its potential returns per unit of risk. Inari Medical is currently generating about -0.01 per unit of risk. If you would invest 694.00 in Haleon plc on August 24, 2024 and sell it today you would earn a total of 271.00 from holding Haleon plc or generate 39.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haleon plc vs. Inari Medical
Performance |
| Timeline |
| Haleon plc |
| Inari Medical |
Haleon Plc and Inari Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haleon Plc and Inari Medical
The main advantage of trading using opposite Haleon Plc and Inari Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haleon Plc position performs unexpectedly, Inari Medical 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 Inari Medical will offset losses from the drop in Inari Medical's long position.| Haleon Plc vs. Teva Pharma Industries | Haleon Plc vs. Bausch Health Companies | Haleon Plc vs. Zoetis Inc | Haleon Plc vs. Takeda Pharmaceutical Co |
| Inari Medical vs. Outset Medical | Inari Medical vs. Legend Biotech Corp | Inari Medical vs. Progyny | Inari Medical vs. Axonics Modulation Technologies |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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