Correlation Between Beyond Air and Eli Lilly
Can any of the company-specific risk be diversified away by investing in both Beyond Air and Eli Lilly 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 Beyond Air and Eli Lilly into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beyond Air and Eli Lilly and, you can compare the effects of market volatilities on Beyond Air and Eli Lilly 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 Beyond Air with a short position of Eli Lilly. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beyond Air and Eli Lilly.
Diversification Opportunities for Beyond Air and Eli Lilly
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Beyond and Eli is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Air and Eli Lilly and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eli Lilly and Beyond Air 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 Beyond Air are associated (or correlated) with Eli Lilly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eli Lilly has no effect on the direction of Beyond Air i.e., Beyond Air and Eli Lilly go up and down completely randomly.
Pair Corralation between Beyond Air and Eli Lilly
Given the investment horizon of 90 days Beyond Air is expected to under-perform the Eli Lilly. In addition to that, Beyond Air is 4.6 times more volatile than Eli Lilly and. It trades about -0.03 of its total potential returns per unit of risk. Eli Lilly and is currently generating about 0.21 per unit of volatility. If you would invest 72,720 in Eli Lilly and on September 18, 2024 and sell it today you would earn a total of 5,142 from holding Eli Lilly and or generate 7.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beyond Air vs. Eli Lilly and
Performance |
| Timeline |
| Beyond Air |
| Eli Lilly |
Beyond Air and Eli Lilly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beyond Air and Eli Lilly
The main advantage of trading using opposite Beyond Air and Eli Lilly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beyond Air position performs unexpectedly, Eli Lilly 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 Eli Lilly will offset losses from the drop in Eli Lilly's long position.| Beyond Air vs. Lucid Diagnostics | Beyond Air vs. Inari Medical | Beyond Air vs. PAVmed Series Z | Beyond Air vs. Clearpoint Neuro |
| Eli Lilly vs. Emergent Biosolutions | Eli Lilly vs. Neurocrine Biosciences | Eli Lilly vs. Teva Pharma Industries | Eli Lilly vs. Haleon 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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