Correlation Between ACERUS PHARMACEUTICALS and Catalent

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

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

Diversification Opportunities for ACERUS PHARMACEUTICALS and Catalent

-0.35
  Correlation Coefficient
ACERUS PHARMACEUTICALS
Catalent

Very good diversification

The 3 months correlation between ACERUS and Catalent is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding ACERUS PHARMACEUTICALS CORP and Catalent in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Catalent and ACERUS 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 ACERUS PHARMACEUTICALS CORP are associated (or correlated) with Catalent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalent has no effect on the direction of ACERUS PHARMACEUTICALS i.e., ACERUS PHARMACEUTICALS and Catalent go up and down completely randomly.

Pair Corralation between ACERUS PHARMACEUTICALS and Catalent

Assuming the 90 days horizon ACERUS PHARMACEUTICALS CORP is expected to under-perform the Catalent. In addition to that, ACERUS PHARMACEUTICALS is 5.14 times more volatile than Catalent. It trades about -0.05 of its total potential returns per unit of risk. Catalent is currently generating about -0.09 per unit of volatility. If you would invest  13,721  in Catalent on July 24, 2021 and sell it today you would lose (448.00)  from holding Catalent or give up 3.27% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

ACERUS PHARMACEUTICALS CORP  vs.  Catalent

 Performance (%) 
      Timeline 
ACERUS PHARMACEUTICALS 
 ACERUS Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in ACERUS PHARMACEUTICALS CORP are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain fundamental indicators, ACERUS PHARMACEUTICALS exhibited solid returns over the last few months and may actually be approaching a breakup point.

ACERUS Price Channel

Catalent 
 Catalent Performance
14 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Catalent are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady essential indicators, Catalent unveiled solid returns over the last few months and may actually be approaching a breakup point.

Catalent Price Channel

ACERUS PHARMACEUTICALS and Catalent Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with ACERUS PHARMACEUTICALS and Catalent

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

ACERUS PHARMACEUTICALS CORP

Pair trading matchups for ACERUS PHARMACEUTICALS

The idea behind ACERUS PHARMACEUTICALS CORP and Catalent 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.

Catalent

Pair trading matchups for Catalent

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .

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