Correlation Between Aquestive Therapeutics and Fleetcor Technologies

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

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

Diversification Opportunities for Aquestive Therapeutics and Fleetcor Technologies

0.49

Correlation Coefficient

Aquestive Therapeutics  Fleetcor Technologies

Very weak diversification

The 3 months correlation between Aquestive and Fleetcor is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Aquestive Therapeutics and Fleetcor Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fleetcor Technologies and Aquestive Therapeutics 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 Aquestive Therapeutics are associated (or correlated) with Fleetcor Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fleetcor Technologies has no effect on the direction of Aquestive Therapeutics i.e., Aquestive Therapeutics and Fleetcor Technologies go up and down completely randomly.

Pair Corralation between Aquestive Therapeutics and Fleetcor Technologies

Given the investment horizon of 90 days Aquestive Therapeutics is expected to generate 5.92 times more return on investment than Fleetcor Technologies. However, Aquestive Therapeutics is 5.92 times more volatile than Fleetcor Technologies. It trades about 0.04 of its potential returns per unit of risk. Fleetcor Technologies is currently generating about -0.91 per unit of risk. If you would invest  328.00  in Aquestive Therapeutics on September 13, 2024 and sell it today you would earn a total of  41.00  from holding Aquestive Therapeutics or generate 12.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	5.48%
Values	Daily Returns

Aquestive Therapeutics  vs.  Fleetcor Technologies

Aquestive Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aquestive Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Fleetcor Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fleetcor Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Fleetcor Technologies is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Aquestive Therapeutics and Fleetcor Technologies

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

The idea behind Aquestive Therapeutics and Fleetcor Technologies 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.