Correlation Between Baxter International and AngioDynamics
Can any of the company-specific risk be diversified away by investing in both Baxter International and AngioDynamics 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 Baxter International and AngioDynamics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baxter International and AngioDynamics, you can compare the effects of market volatilities on Baxter International and AngioDynamics 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 Baxter International with a short position of AngioDynamics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baxter International and AngioDynamics.
Diversification Opportunities for Baxter International and AngioDynamics
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baxter and AngioDynamics is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Baxter International and AngioDynamics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AngioDynamics and Baxter International 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 Baxter International are associated (or correlated) with AngioDynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AngioDynamics has no effect on the direction of Baxter International i.e., Baxter International and AngioDynamics go up and down completely randomly.
Pair Corralation between Baxter International and AngioDynamics
Considering the 90-day investment horizon Baxter International is expected to generate 1.31 times more return on investment than AngioDynamics. However, Baxter International is 1.31 times more volatile than AngioDynamics. It trades about 0.14 of its potential returns per unit of risk. AngioDynamics is currently generating about -0.52 per unit of risk. If you would invest 3,240 in Baxter International on December 2, 2024 and sell it today you would earn a total of 211.00 from holding Baxter International or generate 6.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Baxter International vs. AngioDynamics
Performance |
Timeline |
Baxter International |
AngioDynamics |
Baxter International and AngioDynamics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Baxter International and AngioDynamics
The main advantage of trading using opposite Baxter International and AngioDynamics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baxter International position performs unexpectedly, AngioDynamics 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 AngioDynamics will offset losses from the drop in AngioDynamics' long position.Baxter International vs. Embecta Corp | Baxter International vs. West Pharmaceutical Services | Baxter International vs. ResMed Inc | Baxter International vs. The Cooper Companies, |
AngioDynamics vs. AptarGroup | AngioDynamics vs. Repro Med Systems | AngioDynamics vs. AtriCure | AngioDynamics vs. Akoya Biosciences |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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