Correlation Between Haemonetics and AptarGroup

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

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

Diversification Opportunities for Haemonetics and AptarGroup

0.44

Correlation Coefficient

Haemonetics  AptarGroup

Very weak diversification

The 3 months correlation between Haemonetics and AptarGroup is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Haemonetics and AptarGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptarGroup and Haemonetics 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 Haemonetics are associated (or correlated) with AptarGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AptarGroup has no effect on the direction of Haemonetics i.e., Haemonetics and AptarGroup go up and down completely randomly.

Pair Corralation between Haemonetics and AptarGroup

Considering the 90-day investment horizon Haemonetics is expected to generate 3.41 times more return on investment than AptarGroup. However, Haemonetics is 3.41 times more volatile than AptarGroup. It trades about 0.31 of its potential returns per unit of risk. AptarGroup is currently generating about 0.26 per unit of risk. If you would invest  7,529  in Haemonetics on August 15, 2024 and sell it today you would earn a total of  1,649  from holding Haemonetics or generate 21.9% return on investment over 90 days.

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

Haemonetics  vs.  AptarGroup

Haemonetics

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Haemonetics are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, Haemonetics exhibited solid returns over the last few months and may actually be approaching a breakup point.

AptarGroup

Risk-Adjusted Performance

25 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AptarGroup are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, AptarGroup reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Haemonetics and AptarGroup

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

The idea behind Haemonetics and AptarGroup 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.