Correlation Between Fortress Biotech and GH Research
Can any of the company-specific risk be diversified away by investing in both Fortress Biotech and GH Research 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 Fortress Biotech and GH Research into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortress Biotech and GH Research PLC, you can compare the effects of market volatilities on Fortress Biotech and GH Research 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 Fortress Biotech with a short position of GH Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortress Biotech and GH Research.
Diversification Opportunities for Fortress Biotech and GH Research
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fortress and GHRS is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Biotech and GH Research PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GH Research PLC and Fortress Biotech 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 Fortress Biotech are associated (or correlated) with GH Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GH Research PLC has no effect on the direction of Fortress Biotech i.e., Fortress Biotech and GH Research go up and down completely randomly.
Pair Corralation between Fortress Biotech and GH Research
Given the investment horizon of 90 days Fortress Biotech is expected to under-perform the GH Research. In addition to that, Fortress Biotech is 1.48 times more volatile than GH Research PLC. It trades about -0.02 of its total potential returns per unit of risk. GH Research PLC is currently generating about 0.01 per unit of volatility. If you would invest 1,140 in GH Research PLC on August 25, 2024 and sell it today you would lose (213.00) from holding GH Research PLC or give up 18.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortress Biotech vs. GH Research PLC
Performance |
| Timeline |
| Fortress Biotech |
| GH Research PLC |
Fortress Biotech and GH Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortress Biotech and GH Research
The main advantage of trading using opposite Fortress Biotech and GH Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortress Biotech position performs unexpectedly, GH Research 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 GH Research will offset losses from the drop in GH Research's long position.| Fortress Biotech vs. Eliem Therapeutics | Fortress Biotech vs. HCW Biologics | Fortress Biotech vs. RenovoRx | Fortress Biotech vs. Tempest Therapeutics |
| GH Research vs. Molecular Partners AG | GH Research vs. MediciNova | GH Research vs. Anebulo Pharmaceuticals | GH Research vs. Champions Oncology |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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