Correlation Between AnnexonInc and PAR Technology

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

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

Diversification Opportunities for AnnexonInc and PAR Technology

-0.27

Correlation Coefficient

AnnexonInc  PAR Technology

Very good diversification

The 3 months correlation between AnnexonInc and PAR is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding AnnexonInc and PAR Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PAR Technology and AnnexonInc 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 AnnexonInc are associated (or correlated) with PAR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PAR Technology has no effect on the direction of AnnexonInc i.e., AnnexonInc and PAR Technology go up and down completely randomly.

Pair Corralation between AnnexonInc and PAR Technology

Given the investment horizon of 90 days AnnexonInc is expected to generate 2.51 times more return on investment than PAR Technology. However, AnnexonInc is 2.51 times more volatile than PAR Technology. It trades about 0.12 of its potential returns per unit of risk. PAR Technology is currently generating about 0.13 per unit of risk. If you would invest  208.00  in AnnexonInc on January 25, 2024 and sell it today you would earn a total of  237.00  from holding AnnexonInc or generate 113.94% return on investment over 90 days.

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

AnnexonInc  vs.  PAR Technology

AnnexonInc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AnnexonInc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, AnnexonInc may actually be approaching a critical reversion point that can send shares even higher in May 2024.

PAR Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PAR Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with AnnexonInc and PAR Technology

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

The idea behind AnnexonInc and PAR Technology 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 CEOs Directory module to screen CEOs from public companies around the world.