Correlation Between 458140CA6 and Aquestive Therapeutics

Can any of the company-specific risk be diversified away by investing in both 458140CA6 and Aquestive Therapeutics 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 458140CA6 and Aquestive Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between INTC 415 05 AUG 32 and Aquestive Therapeutics, you can compare the effects of market volatilities on 458140CA6 and Aquestive Therapeutics 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 458140CA6 with a short position of Aquestive Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of 458140CA6 and Aquestive Therapeutics.

Diversification Opportunities for 458140CA6 and Aquestive Therapeutics

-0.33

Correlation Coefficient

458140CA6  Aquestive Therapeutics

Very good diversification

The 3 months correlation between 458140CA6 and Aquestive is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding INTC 415 05 AUG 32 and Aquestive Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquestive Therapeutics and 458140CA6 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 INTC 415 05 AUG 32 are associated (or correlated) with Aquestive Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquestive Therapeutics has no effect on the direction of 458140CA6 i.e., 458140CA6 and Aquestive Therapeutics go up and down completely randomly.

Pair Corralation between 458140CA6 and Aquestive Therapeutics

Assuming the 90 days trading horizon INTC 415 05 AUG 32 is expected to generate 0.25 times more return on investment than Aquestive Therapeutics. However, INTC 415 05 AUG 32 is 4.04 times less risky than Aquestive Therapeutics. It trades about 0.11 of its potential returns per unit of risk. Aquestive Therapeutics is currently generating about -0.32 per unit of risk. If you would invest  9,360  in INTC 415 05 AUG 32 on September 12, 2024 and sell it today you would earn a total of  200.00  from holding INTC 415 05 AUG 32 or generate 2.14% return on investment over 90 days.

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

INTC 415 05 AUG 32  vs.  Aquestive Therapeutics

INTC 415 05

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INTC 415 05 AUG 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 458140CA6 is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Aquestive Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aquestive Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with 458140CA6 and Aquestive Therapeutics

The main advantage of trading using opposite 458140CA6 and Aquestive Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 458140CA6 position performs unexpectedly, Aquestive Therapeutics 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 Aquestive Therapeutics will offset losses from the drop in Aquestive Therapeutics' long position.

The idea behind INTC 415 05 AUG 32 and Aquestive Therapeutics 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..