Correlation Between Amphastar and Hypera SA

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

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

Diversification Opportunities for Amphastar and Hypera SA

-0.81

Correlation Coefficient

Amphastar  Hypera SA

Pay attention - limited upside

The 3 months correlation between Amphastar and Hypera is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Amphastar P and Hypera SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hypera SA and Amphastar 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 Amphastar P are associated (or correlated) with Hypera SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hypera SA has no effect on the direction of Amphastar i.e., Amphastar and Hypera SA go up and down completely randomly.

Pair Corralation between Amphastar and Hypera SA

Given the investment horizon of 90 days Amphastar P is expected to under-perform the Hypera SA. But the stock apears to be less risky and, when comparing its historical volatility, Amphastar P is 1.24 times less risky than Hypera SA. The stock trades about -0.17 of its potential returns per unit of risk. The Hypera SA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  290.00  in Hypera SA on December 30, 2024 and sell it today you would earn a total of  47.00  from holding Hypera SA or generate 16.21% return on investment over 90 days.

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

Amphastar P  vs.  Hypera SA

Amphastar P

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amphastar P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Hypera SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hypera SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile primary indicators, Hypera SA showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amphastar and Hypera SA

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

The idea behind Amphastar P and Hypera SA 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.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.