Correlation Between IQVIA Holdings and Agilent Technologies
Can any of the company-specific risk be diversified away by investing in both IQVIA Holdings and Agilent Technologies 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 IQVIA Holdings and Agilent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IQVIA Holdings and Agilent Technologies, you can compare the effects of market volatilities on IQVIA Holdings and Agilent Technologies 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 IQVIA Holdings with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQVIA Holdings and Agilent Technologies.
Diversification Opportunities for IQVIA Holdings and Agilent Technologies
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between IQVIA and Agilent is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding IQVIA Holdings and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and IQVIA 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 IQVIA Holdings are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of IQVIA Holdings i.e., IQVIA Holdings and Agilent Technologies go up and down completely randomly.
Pair Corralation between IQVIA Holdings and Agilent Technologies
Assuming the 90 days horizon IQVIA Holdings is expected to generate 4.38 times less return on investment than Agilent Technologies. But when comparing it to its historical volatility, IQVIA Holdings is 1.11 times less risky than Agilent Technologies. It trades about 0.05 of its potential returns per unit of risk. Agilent Technologies is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 13,128 in Agilent Technologies on November 5, 2024 and sell it today you would earn a total of 988.00 from holding Agilent Technologies or generate 7.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IQVIA Holdings vs. Agilent Technologies
Performance |
| Timeline |
| IQVIA Holdings |
| Agilent Technologies |
IQVIA Holdings and Agilent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IQVIA Holdings and Agilent Technologies
The main advantage of trading using opposite IQVIA Holdings and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IQVIA Holdings position performs unexpectedly, Agilent Technologies 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.| IQVIA Holdings vs. Yuexiu Transport Infrastructure | IQVIA Holdings vs. Carnegie Clean Energy | IQVIA Holdings vs. TEXAS ROADHOUSE | IQVIA Holdings vs. Mitsui Chemicals |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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