Correlation Between Akso Health and Pharmagen

Can any of the company-specific risk be diversified away by investing in both Akso Health and Pharmagen 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 Akso Health and Pharmagen into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Akso Health Group and Pharmagen, you can compare the effects of market volatilities on Akso Health and Pharmagen 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 Akso Health with a short position of Pharmagen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akso Health and Pharmagen.

Diversification Opportunities for Akso Health and Pharmagen

0.18

Correlation Coefficient

Akso Health  Pharmagen

Average diversification

The 3 months correlation between Akso and Pharmagen is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Akso Health Group and Pharmagen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharmagen and Akso Health 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 Akso Health Group are associated (or correlated) with Pharmagen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharmagen has no effect on the direction of Akso Health i.e., Akso Health and Pharmagen go up and down completely randomly.

Pair Corralation between Akso Health and Pharmagen

Considering the 90-day investment horizon Akso Health Group is expected to under-perform the Pharmagen. But the stock apears to be less risky and, when comparing its historical volatility, Akso Health Group is 29.35 times less risky than Pharmagen. The stock trades about -0.06 of its potential returns per unit of risk. The Pharmagen is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Pharmagen on December 28, 2024 and sell it today you would lose (0.01) from holding Pharmagen or give up 90.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Akso Health Group  vs.  Pharmagen

Akso Health Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Akso Health Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pharmagen

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pharmagen are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Pharmagen showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Akso Health and Pharmagen

The main advantage of trading using opposite Akso Health and Pharmagen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akso Health position performs unexpectedly, Pharmagen 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 Pharmagen will offset losses from the drop in Pharmagen's long position.

The idea behind Akso Health Group and Pharmagen pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.