Correlation Between Amgen and Horizon Global

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

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

Diversification Opportunities for Amgen and Horizon Global

-0.5

Correlation Coefficient

Amgen  Horizon Global

Very good diversification

The 3 months correlation between Amgen and Horizon is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Amgen Inc and Horizon Global Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Global Corp and Amgen 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 Amgen Inc are associated (or correlated) with Horizon Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Global Corp has no effect on the direction of Amgen i.e., Amgen and Horizon Global go up and down completely randomly.

Pair Corralation between Amgen and Horizon Global

If you would invest  176.00  in Horizon Global Corp on January 31, 2024 and sell it today you would earn a total of  0.00  from holding Horizon Global Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

Amgen Inc  vs.  Horizon Global Corp

Amgen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amgen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's technical and fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Horizon Global Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Horizon Global Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Horizon Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Amgen and Horizon Global

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

The idea behind Amgen Inc and Horizon Global Corp 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.