Correlation Between Aerie Pharmaceuticals and Blue Hat

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

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

Diversification Opportunities for Aerie Pharmaceuticals and Blue Hat

-0.2

Correlation Coefficient

Aerie Pharmaceuticals  Blue Hat

Good diversification

The 3 months correlation between Aerie and Blue is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Aerie Pharmaceuticals and Blue Hat Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Hat Interactive and Aerie Pharmaceuticals 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 Aerie Pharmaceuticals are associated (or correlated) with Blue Hat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Hat Interactive has no effect on the direction of Aerie Pharmaceuticals i.e., Aerie Pharmaceuticals and Blue Hat go up and down completely randomly.

Pair Corralation between Aerie Pharmaceuticals and Blue Hat

If you would invest  108.00  in Blue Hat Interactive on March 7, 2024 and sell it today you would earn a total of  3.00  from holding Blue Hat Interactive or generate 2.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Aerie Pharmaceuticals  vs.  Blue Hat Interactive

Aerie Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aerie Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Aerie Pharmaceuticals is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Blue Hat Interactive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blue Hat Interactive has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Blue Hat is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Aerie Pharmaceuticals and Blue Hat

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

The idea behind Aerie Pharmaceuticals and Blue Hat Interactive 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.