Correlation Between ANI Pharmaceuticals and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ANI Pharmaceuticals and Dow Jones 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 ANI Pharmaceuticals and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANI Pharmaceuticals and Dow Jones Industrial, you can compare the effects of market volatilities on ANI Pharmaceuticals and Dow Jones 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 ANI Pharmaceuticals with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANI Pharmaceuticals and Dow Jones.
Diversification Opportunities for ANI Pharmaceuticals and Dow Jones
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ANI and Dow is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding ANI Pharmaceuticals and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and ANI 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 ANI Pharmaceuticals are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of ANI Pharmaceuticals i.e., ANI Pharmaceuticals and Dow Jones go up and down completely randomly.
Pair Corralation between ANI Pharmaceuticals and Dow Jones
Given the investment horizon of 90 days ANI Pharmaceuticals is expected to generate 2.54 times less return on investment than Dow Jones. In addition to that, ANI Pharmaceuticals is 3.04 times more volatile than Dow Jones Industrial. It trades about 0.02 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of volatility. If you would invest 4,162,208 in Dow Jones Industrial on September 14, 2024 and sell it today you would earn a total of 229,204 from holding Dow Jones Industrial or generate 5.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ANI Pharmaceuticals vs. Dow Jones Industrial
Performance |
Timeline |
ANI Pharmaceuticals and Dow Jones Volatility Contrast
Predicted Return Density |
Returns |
ANI Pharmaceuticals
Pair trading matchups for ANI Pharmaceuticals
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ANI Pharmaceuticals and Dow Jones
The main advantage of trading using opposite ANI Pharmaceuticals and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANI Pharmaceuticals position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.ANI Pharmaceuticals vs. Phibro Animal Health | ANI Pharmaceuticals vs. Prestige Brand Holdings | ANI Pharmaceuticals vs. Alkermes Plc | ANI Pharmaceuticals vs. Dr Reddys Laboratories |
Dow Jones vs. Hurco Companies | Dow Jones vs. Tyson Foods | Dow Jones vs. MYR Group | Dow Jones vs. Cannae Holdings |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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