Correlation Between Lantheus Holdings and Alvotech
Can any of the company-specific risk be diversified away by investing in both Lantheus Holdings and Alvotech 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 Lantheus Holdings and Alvotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lantheus Holdings and Alvotech, you can compare the effects of market volatilities on Lantheus Holdings and Alvotech 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 Lantheus Holdings with a short position of Alvotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lantheus Holdings and Alvotech.
Diversification Opportunities for Lantheus Holdings and Alvotech
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lantheus and Alvotech is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Lantheus Holdings and Alvotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech and Lantheus Holdings 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 Lantheus Holdings are associated (or correlated) with Alvotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech has no effect on the direction of Lantheus Holdings i.e., Lantheus Holdings and Alvotech go up and down completely randomly.
Pair Corralation between Lantheus Holdings and Alvotech
Given the investment horizon of 90 days Lantheus Holdings is expected to generate 1.9 times more return on investment than Alvotech. However, Lantheus Holdings is 1.9 times more volatile than Alvotech. It trades about 0.12 of its potential returns per unit of risk. Alvotech is currently generating about -0.12 per unit of risk. If you would invest 8,515 in Lantheus Holdings on September 13, 2024 and sell it today you would earn a total of 625.00 from holding Lantheus Holdings or generate 7.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lantheus Holdings vs. Alvotech
Performance |
| Timeline |
| Lantheus Holdings |
| Alvotech |
Lantheus Holdings and Alvotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lantheus Holdings and Alvotech
The main advantage of trading using opposite Lantheus Holdings and Alvotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lantheus Holdings position performs unexpectedly, Alvotech 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 Alvotech will offset losses from the drop in Alvotech's long position.| Lantheus Holdings vs. Neurocrine Biosciences | Lantheus Holdings vs. Ironwood Pharmaceuticals | Lantheus Holdings vs. Alkermes Plc | Lantheus Holdings vs. Avadel Pharmaceuticals PLC |
| Alvotech vs. Puma Biotechnology | Alvotech vs. Iovance Biotherapeutics | Alvotech vs. Sarepta Therapeutics | Alvotech vs. Day One Biopharmaceuticals |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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