Correlation Between Astellas Pharma and INSURANCE AUST
Can any of the company-specific risk be diversified away by investing in both Astellas Pharma and INSURANCE AUST 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 Astellas Pharma and INSURANCE AUST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astellas Pharma and INSURANCE AUST GRP, you can compare the effects of market volatilities on Astellas Pharma and INSURANCE AUST 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 Astellas Pharma with a short position of INSURANCE AUST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astellas Pharma and INSURANCE AUST.
Diversification Opportunities for Astellas Pharma and INSURANCE AUST
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Astellas and INSURANCE is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Astellas Pharma and INSURANCE AUST GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INSURANCE AUST GRP and Astellas Pharma 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 Astellas Pharma are associated (or correlated) with INSURANCE AUST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INSURANCE AUST GRP has no effect on the direction of Astellas Pharma i.e., Astellas Pharma and INSURANCE AUST go up and down completely randomly.
Pair Corralation between Astellas Pharma and INSURANCE AUST
Assuming the 90 days horizon Astellas Pharma is expected to under-perform the INSURANCE AUST. In addition to that, Astellas Pharma is 1.28 times more volatile than INSURANCE AUST GRP. It trades about -0.16 of its total potential returns per unit of risk. INSURANCE AUST GRP is currently generating about 0.36 per unit of volatility. If you would invest 448.00 in INSURANCE AUST GRP on August 26, 2024 and sell it today you would earn a total of 57.00 from holding INSURANCE AUST GRP or generate 12.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astellas Pharma vs. INSURANCE AUST GRP
Performance |
| Timeline |
| Astellas Pharma |
| INSURANCE AUST GRP |
Astellas Pharma and INSURANCE AUST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astellas Pharma and INSURANCE AUST
The main advantage of trading using opposite Astellas Pharma and INSURANCE AUST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astellas Pharma position performs unexpectedly, INSURANCE AUST 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 INSURANCE AUST will offset losses from the drop in INSURANCE AUST's long position.| Astellas Pharma vs. INSURANCE AUST GRP | Astellas Pharma vs. INTER CARS SA | Astellas Pharma vs. Cars Inc | Astellas Pharma vs. CARSALESCOM |
| INSURANCE AUST vs. Apple Inc | INSURANCE AUST vs. Apple Inc | INSURANCE AUST vs. Apple Inc | INSURANCE AUST vs. Apple Inc |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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