Correlation Between Tegna and Astellas Pharma
Can any of the company-specific risk be diversified away by investing in both Tegna and Astellas 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 Tegna and Astellas Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tegna Inc and Astellas Pharma, you can compare the effects of market volatilities on Tegna and Astellas 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 Tegna with a short position of Astellas Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tegna and Astellas Pharma.
Diversification Opportunities for Tegna and Astellas Pharma
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Tegna and Astellas is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Tegna Inc and Astellas Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astellas Pharma and Tegna 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 Tegna Inc are associated (or correlated) with Astellas Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astellas Pharma has no effect on the direction of Tegna i.e., Tegna and Astellas Pharma go up and down completely randomly.
Pair Corralation between Tegna and Astellas Pharma
Given the investment horizon of 90 days Tegna Inc is expected to generate 0.82 times more return on investment than Astellas Pharma. However, Tegna Inc is 1.23 times less risky than Astellas Pharma. It trades about -0.07 of its potential returns per unit of risk. Astellas Pharma is currently generating about -0.09 per unit of risk. If you would invest 1,845 in Tegna Inc on November 8, 2024 and sell it today you would lose (32.00) from holding Tegna Inc or give up 1.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tegna Inc vs. Astellas Pharma
Performance |
| Timeline |
| Tegna Inc |
| Astellas Pharma |
Tegna and Astellas Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tegna and Astellas Pharma
The main advantage of trading using opposite Tegna and Astellas Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tegna position performs unexpectedly, Astellas 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 Astellas Pharma will offset losses from the drop in Astellas Pharma's long position.| Tegna vs. E W Scripps | Tegna vs. Gray Television | Tegna vs. iHeartMedia Class A | Tegna vs. Cumulus Media Class |
| Astellas Pharma vs. Bayer AG | Astellas Pharma vs. Daiichi Sankyo | Astellas Pharma vs. AstraZeneca PLC | Astellas Pharma vs. Astellas Pharma |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |