Correlation Between 90331HPL1 and Bausch
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By analyzing existing cross correlation between US BANK NATIONAL and Bausch Health Companies, you can compare the effects of market volatilities on 90331HPL1 and Bausch 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 90331HPL1 with a short position of Bausch. Check out your portfolio center. Please also check ongoing floating volatility patterns of 90331HPL1 and Bausch.
Diversification Opportunities for 90331HPL1 and Bausch
Poor diversification
The 3 months correlation between 90331HPL1 and Bausch is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding US BANK NATIONAL 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 90331HPL1 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 US BANK NATIONAL are associated (or correlated) with Bausch. 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 90331HPL1 i.e., 90331HPL1 and Bausch go up and down completely randomly.
Pair Corralation between 90331HPL1 and Bausch
Assuming the 90 days trading horizon US BANK NATIONAL is expected to under-perform the Bausch. But the bond apears to be less risky and, when comparing its historical volatility, US BANK NATIONAL is 2.79 times less risky than Bausch. The bond trades about -0.11 of its potential returns per unit of risk. The Bausch Health Companies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,675 in Bausch Health Companies on September 9, 2024 and sell it today you would earn a total of 115.00 from holding Bausch Health Companies or generate 1.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 64.86% |
Values | Daily Returns |
US BANK NATIONAL vs. Bausch Health Companies
Performance |
Timeline |
US BANK NATIONAL |
Bausch Health Companies |
90331HPL1 and Bausch Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with 90331HPL1 and Bausch
The main advantage of trading using opposite 90331HPL1 and Bausch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 90331HPL1 position performs unexpectedly, Bausch 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 will offset losses from the drop in Bausch's long position.90331HPL1 vs. Titan Machinery | 90331HPL1 vs. Grocery Outlet Holding | 90331HPL1 vs. Merit Medical Systems | 90331HPL1 vs. Amgen Inc |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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