Correlation Between Bank Central and Acasti Pharma
Can any of the company-specific risk be diversified away by investing in both Bank Central and Acasti Pharma 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 Bank Central and Acasti Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Central Asia and Acasti Pharma, you can compare the effects of market volatilities on Bank Central and Acasti Pharma 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 Bank Central with a short position of Acasti Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Central and Acasti Pharma.
Diversification Opportunities for Bank Central and Acasti Pharma
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Acasti is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bank Central Asia and Acasti Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acasti Pharma and Bank Central 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 Bank Central Asia are associated (or correlated) with Acasti Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acasti Pharma has no effect on the direction of Bank Central i.e., Bank Central and Acasti Pharma go up and down completely randomly.
Pair Corralation between Bank Central and Acasti Pharma
Assuming the 90 days horizon Bank Central is expected to generate 1.82 times less return on investment than Acasti Pharma. But when comparing it to its historical volatility, Bank Central Asia is 2.14 times less risky than Acasti Pharma. It trades about 0.02 of its potential returns per unit of risk. Acasti Pharma is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 341.00 in Acasti Pharma on September 1, 2024 and sell it today you would lose (4.00) from holding Acasti Pharma or give up 1.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 87.77% |
| Values | Daily Returns |
Bank Central Asia vs. Acasti Pharma
Performance |
| Timeline |
| Bank Central Asia |
| Acasti Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Bank Central and Acasti Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Central and Acasti Pharma
The main advantage of trading using opposite Bank Central and Acasti Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Central position performs unexpectedly, Acasti Pharma 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 Acasti Pharma will offset losses from the drop in Acasti Pharma's long position.| Bank Central vs. Piraeus Bank SA | Bank Central vs. Turkiye Garanti Bankasi | Bank Central vs. Delhi Bank Corp | Bank Central vs. Uwharrie Capital Corp |
| Acasti Pharma vs. Tonix Pharmaceuticals Holding | Acasti Pharma vs. Jaguar Animal Health | Acasti Pharma vs. Ibio Inc | Acasti Pharma vs. Akari Therapeutics PLC |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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