Correlation Between IQVIA Holdings and Revvity

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

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

Diversification Opportunities for IQVIA Holdings and Revvity

0.59

Correlation Coefficient

IQVIA Holdings  Revvity

Very weak diversification

The 3 months correlation between IQVIA and Revvity is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding IQVIA Holdings and Revvity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Revvity and IQVIA Holdings 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 IQVIA Holdings are associated (or correlated) with Revvity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Revvity has no effect on the direction of IQVIA Holdings i.e., IQVIA Holdings and Revvity go up and down completely randomly.

Pair Corralation between IQVIA Holdings and Revvity

Considering the 90-day investment horizon IQVIA Holdings is expected to under-perform the Revvity. But the stock apears to be less risky and, when comparing its historical volatility, IQVIA Holdings is 1.25 times less risky than Revvity. The stock trades about -0.05 of its potential returns per unit of risk. The Revvity is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  11,607  in Revvity on November 28, 2024 and sell it today you would lose (58.00) from holding Revvity or give up 0.5% of portfolio value over 90 days.

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

IQVIA Holdings  vs.  Revvity

IQVIA Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days IQVIA Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, IQVIA Holdings is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Revvity

Risk-Adjusted Performance

Very Weak

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

Pair Trading with IQVIA Holdings and Revvity

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

The idea behind IQVIA Holdings and Revvity 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.