Correlation Between Shuttle Pharmaceuticals and Bausch Health
Can any of the company-specific risk be diversified away by investing in both Shuttle Pharmaceuticals and Bausch Health 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 Shuttle Pharmaceuticals and Bausch Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shuttle Pharmaceuticals and Bausch Health Companies, you can compare the effects of market volatilities on Shuttle Pharmaceuticals and Bausch Health 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 Shuttle Pharmaceuticals with a short position of Bausch Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuttle Pharmaceuticals and Bausch Health.
Diversification Opportunities for Shuttle Pharmaceuticals and Bausch Health
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shuttle and Bausch is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Shuttle Pharmaceuticals and Bausch Health Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bausch Health Companies and Shuttle Pharmaceuticals 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 Shuttle Pharmaceuticals are associated (or correlated) with Bausch Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bausch Health Companies has no effect on the direction of Shuttle Pharmaceuticals i.e., Shuttle Pharmaceuticals and Bausch Health go up and down completely randomly.
Pair Corralation between Shuttle Pharmaceuticals and Bausch Health
Given the investment horizon of 90 days Shuttle Pharmaceuticals is expected to under-perform the Bausch Health. In addition to that, Shuttle Pharmaceuticals is 2.48 times more volatile than Bausch Health Companies. It trades about -0.17 of its total potential returns per unit of risk. Bausch Health Companies is currently generating about -0.03 per unit of volatility. If you would invest 819.00 in Bausch Health Companies on August 29, 2024 and sell it today you would lose (30.00) from holding Bausch Health Companies or give up 3.66% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Shuttle Pharmaceuticals vs. Bausch Health Companies
Performance |
Timeline |
Shuttle Pharmaceuticals |
Bausch Health Companies |
Shuttle Pharmaceuticals and Bausch Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shuttle Pharmaceuticals and Bausch Health
The main advantage of trading using opposite Shuttle Pharmaceuticals and Bausch Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuttle Pharmaceuticals position performs unexpectedly, Bausch Health 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 Bausch Health will offset losses from the drop in Bausch Health's long position.Shuttle Pharmaceuticals vs. Lifecore Biomedical | Shuttle Pharmaceuticals vs. Catalent | Shuttle Pharmaceuticals vs. Tilray Inc | Shuttle Pharmaceuticals vs. Organogenesis Holdings |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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