Correlation Between Hologic and Alcon AG
Can any of the company-specific risk be diversified away by investing in both Hologic and Alcon AG 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 Hologic and Alcon AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hologic and Alcon AG, you can compare the effects of market volatilities on Hologic and Alcon AG 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 Hologic with a short position of Alcon AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hologic and Alcon AG.
Diversification Opportunities for Hologic and Alcon AG
Very weak diversification
The 3 months correlation between Hologic and Alcon is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hologic and Alcon AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alcon AG and Hologic 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 Hologic are associated (or correlated) with Alcon AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcon AG has no effect on the direction of Hologic i.e., Hologic and Alcon AG go up and down completely randomly.
Pair Corralation between Hologic and Alcon AG
Given the investment horizon of 90 days Hologic is expected to generate 2.67 times less return on investment than Alcon AG. But when comparing it to its historical volatility, Hologic is 1.23 times less risky than Alcon AG. It trades about 0.02 of its potential returns per unit of risk. Alcon AG is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,743 in Alcon AG on August 28, 2024 and sell it today you would earn a total of 1,874 from holding Alcon AG or generate 27.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hologic vs. Alcon AG
Performance |
| Timeline |
| Hologic |
| Alcon AG |
Hologic and Alcon AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hologic and Alcon AG
The main advantage of trading using opposite Hologic and Alcon AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hologic position performs unexpectedly, Alcon AG 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 Alcon AG will offset losses from the drop in Alcon AG's long position.| Hologic vs. Haemonetics | Hologic vs. ICU Medical | Hologic vs. Envista Holdings Corp | Hologic vs. The Cooper Companies, |
| Alcon AG vs. Heartbeam | Alcon AG vs. EUDA Health Holdings | Alcon AG vs. Nutex Health | Alcon AG vs. Healthcare Triangle |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |