Correlation Between ICU Medical and AptarGroup
Can any of the company-specific risk be diversified away by investing in both ICU Medical and AptarGroup 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 ICU Medical and AptarGroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICU Medical and AptarGroup, you can compare the effects of market volatilities on ICU Medical and AptarGroup 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 ICU Medical with a short position of AptarGroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICU Medical and AptarGroup.
Diversification Opportunities for ICU Medical and AptarGroup
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ICU and AptarGroup is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding ICU Medical and AptarGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptarGroup and ICU Medical 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 ICU Medical are associated (or correlated) with AptarGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AptarGroup has no effect on the direction of ICU Medical i.e., ICU Medical and AptarGroup go up and down completely randomly.
Pair Corralation between ICU Medical and AptarGroup
Given the investment horizon of 90 days ICU Medical is expected to under-perform the AptarGroup. In addition to that, ICU Medical is 1.62 times more volatile than AptarGroup. It trades about -0.03 of its total potential returns per unit of risk. AptarGroup is currently generating about -0.01 per unit of volatility. If you would invest 15,954 in AptarGroup on October 31, 2024 and sell it today you would lose (243.00) from holding AptarGroup or give up 1.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICU Medical vs. AptarGroup
Performance |
| Timeline |
| ICU Medical |
| AptarGroup |
ICU Medical and AptarGroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICU Medical and AptarGroup
The main advantage of trading using opposite ICU Medical and AptarGroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICU Medical position performs unexpectedly, AptarGroup 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 AptarGroup will offset losses from the drop in AptarGroup's long position.| ICU Medical vs. Merit Medical Systems | ICU Medical vs. The Cooper Companies, | ICU Medical vs. AngioDynamics | ICU Medical vs. AptarGroup |
| AptarGroup vs. Haemonetics | AptarGroup vs. Merit Medical Systems | AptarGroup vs. AngioDynamics | AptarGroup vs. Envista Holdings Corp |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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