Correlation Between Acasti Pharma and Guardion Health
Can any of the company-specific risk be diversified away by investing in both Acasti Pharma and Guardion Health 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 Acasti Pharma and Guardion Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acasti Pharma and Guardion Health Sciences, you can compare the effects of market volatilities on Acasti Pharma and Guardion Health 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 Acasti Pharma with a short position of Guardion Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acasti Pharma and Guardion Health.
Diversification Opportunities for Acasti Pharma and Guardion Health
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Acasti and Guardion is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Acasti Pharma and Guardion Health Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardion Health Sciences and Acasti Pharma 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 Acasti Pharma are associated (or correlated) with Guardion Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardion Health Sciences has no effect on the direction of Acasti Pharma i.e., Acasti Pharma and Guardion Health go up and down completely randomly.
Pair Corralation between Acasti Pharma and Guardion Health
Given the investment horizon of 90 days Acasti Pharma is expected to generate 1.22 times less return on investment than Guardion Health. But when comparing it to its historical volatility, Acasti Pharma is 1.33 times less risky than Guardion Health. It trades about 0.04 of its potential returns per unit of risk. Guardion Health Sciences is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 278.00 in Guardion Health Sciences on August 26, 2024 and sell it today you would earn a total of 51.00 from holding Guardion Health Sciences or generate 18.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.95% |
| Values | Daily Returns |
Acasti Pharma vs. Guardion Health Sciences
Performance |
| Timeline |
| Acasti Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Guardion Health Sciences |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Acasti Pharma and Guardion Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acasti Pharma and Guardion Health
The main advantage of trading using opposite Acasti Pharma and Guardion Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acasti Pharma position performs unexpectedly, Guardion Health 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 Guardion Health will offset losses from the drop in Guardion Health's long position.| Acasti Pharma vs. Tonix Pharmaceuticals Holding | Acasti Pharma vs. Jaguar Animal Health | Acasti Pharma vs. Ibio Inc | Acasti Pharma vs. Akari Therapeutics PLC |
| Guardion Health vs. Biofrontera | Guardion Health vs. Shuttle Pharmaceuticals | Guardion Health vs. Akanda Corp | Guardion Health vs. China Pharma Holdings |
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 the Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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