Correlation Between HP and AMGEN
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By analyzing existing cross correlation between HP Inc and AMGEN INC, you can compare the effects of market volatilities on HP 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 HP with a short position of AMGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of HP and AMGEN.
Diversification Opportunities for HP and AMGEN
Excellent diversification
The 3 months correlation between HP and AMGEN is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding HP Inc and AMGEN INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGEN INC and HP 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 HP Inc 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 HP i.e., HP and AMGEN go up and down completely randomly.
Pair Corralation between HP and AMGEN
Considering the 90-day investment horizon HP Inc is expected to under-perform the AMGEN. In addition to that, HP is 4.13 times more volatile than AMGEN INC. It trades about 0.0 of its total potential returns per unit of risk. AMGEN INC is currently generating about -0.01 per unit of volatility. If you would invest 8,701 in AMGEN INC on August 29, 2024 and sell it today you would lose (45.00) from holding AMGEN INC or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
HP Inc vs. AMGEN INC
Performance |
| Timeline |
| HP Inc |
| AMGEN INC |
HP and AMGEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HP and AMGEN
The main advantage of trading using opposite HP and AMGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HP 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.The idea behind HP Inc and AMGEN INC 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.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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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