Correlation Between Intracellular and Catalent
Can any of the company-specific risk be diversified away by investing in both Intracellular and Catalent 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 Intracellular and Catalent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intracellular Th and Catalent, you can compare the effects of market volatilities on Intracellular and Catalent 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 Intracellular with a short position of Catalent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intracellular and Catalent.
Diversification Opportunities for Intracellular and Catalent
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intracellular and Catalent is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Intracellular Th and Catalent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalent and Intracellular 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 Intracellular Th are associated (or correlated) with Catalent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalent has no effect on the direction of Intracellular i.e., Intracellular and Catalent go up and down completely randomly.
Pair Corralation between Intracellular and Catalent
Given the investment horizon of 90 days Intracellular Th is expected to generate 3.64 times more return on investment than Catalent. However, Intracellular is 3.64 times more volatile than Catalent. It trades about 0.17 of its potential returns per unit of risk. Catalent is currently generating about 0.24 per unit of risk. If you would invest 7,682 in Intracellular Th on August 28, 2024 and sell it today you would earn a total of 817.00 from holding Intracellular Th or generate 10.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intracellular Th vs. Catalent
Performance |
| Timeline |
| Intracellular Th |
| Catalent |
Intracellular and Catalent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intracellular and Catalent
The main advantage of trading using opposite Intracellular and Catalent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intracellular position performs unexpectedly, Catalent 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 Catalent will offset losses from the drop in Catalent's long position.| Intracellular vs. Alkermes Plc | Intracellular vs. Ironwood Pharmaceuticals | Intracellular vs. Pacira BioSciences, | Intracellular vs. Collegium Pharmaceutical |
| Catalent vs. IQVIA Holdings | Catalent vs. West Pharmaceutical Services | Catalent vs. Charles River Laboratories | Catalent vs. Bio Rad Laboratories |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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