Correlation Between INDIVIOR PLC and Haleon Plc

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

By analyzing existing cross correlation between INDIVIOR PLC ADR and Haleon plc, you can compare the effects of market volatilities on INDIVIOR PLC and Haleon Plc 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 INDIVIOR PLC with a short position of Haleon Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of INDIVIOR PLC and Haleon Plc.

Diversification Opportunities for INDIVIOR PLC and Haleon Plc

0.0

Correlation Coefficient

INDIVIOR PLC  Haleon Plc

Pay attention - limited upside

The 3 months correlation between INDIVIOR and Haleon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding INDIVIOR PLC ADR and Haleon plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haleon plc and INDIVIOR PLC 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 INDIVIOR PLC ADR are associated (or correlated) with Haleon Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haleon plc has no effect on the direction of INDIVIOR PLC i.e., INDIVIOR PLC and Haleon Plc go up and down completely randomly.

Pair Corralation between INDIVIOR PLC and Haleon Plc

If you would invest  967.00  in Haleon plc on December 1, 2024 and sell it today you would earn a total of  51.00  from holding Haleon plc or generate 5.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

INDIVIOR PLC ADR  vs.  Haleon plc

INDIVIOR PLC ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days INDIVIOR PLC ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, INDIVIOR PLC is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Haleon plc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Haleon plc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy essential indicators, Haleon Plc is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with INDIVIOR PLC and Haleon Plc

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

The idea behind INDIVIOR PLC ADR and Haleon plc 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.