Correlation Between AmerisourceBergen and Boston Scientific
Can any of the company-specific risk be diversified away by investing in both AmerisourceBergen and Boston Scientific 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 AmerisourceBergen and Boston Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AmerisourceBergen and Boston Scientific Corp, you can compare the effects of market volatilities on AmerisourceBergen and Boston Scientific 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 AmerisourceBergen with a short position of Boston Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of AmerisourceBergen and Boston Scientific.
Diversification Opportunities for AmerisourceBergen and Boston Scientific
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AmerisourceBergen and Boston is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding AmerisourceBergen and Boston Scientific Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Scientific Corp and AmerisourceBergen 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 AmerisourceBergen are associated (or correlated) with Boston Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Scientific Corp has no effect on the direction of AmerisourceBergen i.e., AmerisourceBergen and Boston Scientific go up and down completely randomly.
Pair Corralation between AmerisourceBergen and Boston Scientific
If you would invest 6,794 in Boston Scientific Corp on January 26, 2024 and sell it today you would earn a total of 497.00 from holding Boston Scientific Corp or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
AmerisourceBergen vs. Boston Scientific Corp
Performance |
| Timeline |
| AmerisourceBergen |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Boston Scientific Corp |
AmerisourceBergen and Boston Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AmerisourceBergen and Boston Scientific
The main advantage of trading using opposite AmerisourceBergen and Boston Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AmerisourceBergen position performs unexpectedly, Boston Scientific 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 Boston Scientific will offset losses from the drop in Boston Scientific's long position.| AmerisourceBergen vs. Cardinal Health | AmerisourceBergen vs. Henry Schein | AmerisourceBergen vs. Owens Minor | AmerisourceBergen vs. Patterson Companies |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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