Correlation Between HUNTINGTON and Amgen

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

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

Diversification Opportunities for HUNTINGTON and Amgen

0.29

Correlation Coefficient

HUNTINGTON  Amgen

Modest diversification

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

Pair Corralation between HUNTINGTON and Amgen

Assuming the 90 days trading horizon HUNTINGTON is expected to generate 7.6 times less return on investment than Amgen. But when comparing it to its historical volatility, HUNTINGTON BANCSHARES INC is 2.79 times less risky than Amgen. It trades about 0.0 of its potential returns per unit of risk. Amgen Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  25,492  in Amgen Inc on October 4, 2024 and sell it today you would earn a total of  572.00  from holding Amgen Inc or generate 2.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.97%
Values	Daily Returns

HUNTINGTON BANCSHARES INC  vs.  Amgen Inc

HUNTINGTON BANCSHARES INC

Risk-Adjusted Performance

0 of 100

Very Weak

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

Amgen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amgen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with HUNTINGTON and Amgen

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

The idea behind HUNTINGTON BANCSHARES INC and Amgen Inc 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.