Correlation Between Eurotech SpA and ANI Pharmaceuticals

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

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

Diversification Opportunities for Eurotech SpA and ANI Pharmaceuticals

0.0

Correlation Coefficient

Eurotech SpA  ANI Pharmaceuticals

Pay attention - limited upside

The 3 months correlation between Eurotech and ANI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eurotech SpA and ANI Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANI Pharmaceuticals and Eurotech SpA 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 Eurotech SpA are associated (or correlated) with ANI Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANI Pharmaceuticals has no effect on the direction of Eurotech SpA i.e., Eurotech SpA and ANI Pharmaceuticals go up and down completely randomly.

Pair Corralation between Eurotech SpA and ANI Pharmaceuticals

If you would invest  66.00  in Eurotech SpA on April 24, 2025 and sell it today you would earn a total of  23.00  from holding Eurotech SpA or generate 34.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Eurotech SpA  vs.  ANI Pharmaceuticals

Eurotech SpA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eurotech SpA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Eurotech SpA reported solid returns over the last few months and may actually be approaching a breakup point.

ANI Pharmaceuticals

Risk-Adjusted Performance

Very Weak

Over the last 90 days ANI Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, ANI Pharmaceuticals is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Eurotech SpA and ANI Pharmaceuticals

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

The idea behind Eurotech SpA and ANI Pharmaceuticals 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.