Correlation Between Forian and 10X Genomics
Can any of the company-specific risk be diversified away by investing in both Forian and 10X Genomics 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 Forian and 10X Genomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forian Inc and 10X Genomics, you can compare the effects of market volatilities on Forian and 10X Genomics 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 Forian with a short position of 10X Genomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forian and 10X Genomics.
Diversification Opportunities for Forian and 10X Genomics
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Forian and 10X is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Forian Inc and 10X Genomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 10X Genomics and Forian 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 Forian Inc are associated (or correlated) with 10X Genomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 10X Genomics has no effect on the direction of Forian i.e., Forian and 10X Genomics go up and down completely randomly.
Pair Corralation between Forian and 10X Genomics
Given the investment horizon of 90 days Forian Inc is expected to generate 0.61 times more return on investment than 10X Genomics. However, Forian Inc is 1.65 times less risky than 10X Genomics. It trades about 0.03 of its potential returns per unit of risk. 10X Genomics is currently generating about -0.02 per unit of risk. If you would invest 204.00 in Forian Inc on September 2, 2024 and sell it today you would earn a total of 2.00 from holding Forian Inc or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forian Inc vs. 10X Genomics
Performance |
| Timeline |
| Forian Inc |
| 10X Genomics |
Forian and 10X Genomics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forian and 10X Genomics
The main advantage of trading using opposite Forian and 10X Genomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forian position performs unexpectedly, 10X Genomics 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 10X Genomics will offset losses from the drop in 10X Genomics' long position.| Forian vs. Profound Medical Corp | Forian vs. Si Bone | Forian vs. Nevro Corp | Forian vs. Orthopediatrics Corp |
| 10X Genomics vs. Verve Therapeutics | 10X Genomics vs. Beam Therapeutics | 10X Genomics vs. Caribou Biosciences | 10X Genomics vs. Sana Biotechnology |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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