Correlation Between BEXIMCO PHARMAGDR and ANI Pharmaceuticals

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

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

Diversification Opportunities for BEXIMCO PHARMAGDR and ANI Pharmaceuticals

0.29

Correlation Coefficient

BEXIMCO PHARMAGDR  ANI Pharmaceuticals

Modest diversification

The 3 months correlation between BEXIMCO and ANI is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding BEXIMCO PHARMAGDR REGS and ANI Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANI Pharmaceuticals and BEXIMCO PHARMAGDR 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 BEXIMCO PHARMAGDR REGS are associated (or correlated) with ANI Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANI Pharmaceuticals has no effect on the direction of BEXIMCO PHARMAGDR i.e., BEXIMCO PHARMAGDR and ANI Pharmaceuticals go up and down completely randomly.

Pair Corralation between BEXIMCO PHARMAGDR and ANI Pharmaceuticals

Assuming the 90 days trading horizon BEXIMCO PHARMAGDR REGS is expected to generate 1.86 times more return on investment than ANI Pharmaceuticals. However, BEXIMCO PHARMAGDR is 1.86 times more volatile than ANI Pharmaceuticals. It trades about 0.02 of its potential returns per unit of risk. ANI Pharmaceuticals is currently generating about 0.03 per unit of risk. If you would invest  45.00  in BEXIMCO PHARMAGDR REGS on September 26, 2024 and sell it today you would lose (4.00) from holding BEXIMCO PHARMAGDR REGS or give up 8.89% of portfolio value over 90 days.

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

BEXIMCO PHARMAGDR REGS  vs.  ANI Pharmaceuticals

BEXIMCO PHARMAGDR REGS

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in BEXIMCO PHARMAGDR REGS are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, BEXIMCO PHARMAGDR reported solid returns over the last few months and may actually be approaching a breakup point.

ANI Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ANI Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, ANI Pharmaceuticals 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 BEXIMCO PHARMAGDR and ANI Pharmaceuticals

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

The idea behind BEXIMCO PHARMAGDR REGS and ANI Pharmaceuticals 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.