Correlation Between Pacira BioSciences, and Amphastar

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

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

Diversification Opportunities for Pacira BioSciences, and Amphastar

0.79

Correlation Coefficient

Pacira BioSciences,  Amphastar

Poor diversification

The 3 months correlation between Pacira and Amphastar is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Pacira BioSciences, and Amphastar P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amphastar P and Pacira BioSciences, 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 Pacira BioSciences, are associated (or correlated) with Amphastar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amphastar P has no effect on the direction of Pacira BioSciences, i.e., Pacira BioSciences, and Amphastar go up and down completely randomly.

Pair Corralation between Pacira BioSciences, and Amphastar

Given the investment horizon of 90 days Pacira BioSciences, is expected to generate 0.95 times more return on investment than Amphastar. However, Pacira BioSciences, is 1.05 times less risky than Amphastar. It trades about -0.11 of its potential returns per unit of risk. Amphastar P is currently generating about -0.11 per unit of risk. If you would invest  2,581  in Pacira BioSciences, on May 4, 2025 and sell it today you would lose (374.00) from holding Pacira BioSciences, or give up 14.49% of portfolio value over 90 days.

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

Pacira BioSciences,  vs.  Amphastar P

Pacira BioSciences,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pacira BioSciences, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Amphastar P

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amphastar P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Pacira BioSciences, and Amphastar

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

The idea behind Pacira BioSciences, and Amphastar P 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.