Correlation Between Geron and Pharmather Holdings
Can any of the company-specific risk be diversified away by investing in both Geron and Pharmather Holdings 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 Geron and Pharmather Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geron and Pharmather Holdings, you can compare the effects of market volatilities on Geron and Pharmather Holdings 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 Geron with a short position of Pharmather Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geron and Pharmather Holdings.
Diversification Opportunities for Geron and Pharmather Holdings
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Geron and Pharmather is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Geron and Pharmather Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharmather Holdings and Geron 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 Geron are associated (or correlated) with Pharmather Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharmather Holdings has no effect on the direction of Geron i.e., Geron and Pharmather Holdings go up and down completely randomly.
Pair Corralation between Geron and Pharmather Holdings
Given the investment horizon of 90 days Geron is expected to generate 2.15 times less return on investment than Pharmather Holdings. But when comparing it to its historical volatility, Geron is 1.33 times less risky than Pharmather Holdings. It trades about 0.04 of its potential returns per unit of risk. Pharmather Holdings is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 5.10 in Pharmather Holdings on September 2, 2024 and sell it today you would earn a total of 11.90 from holding Pharmather Holdings or generate 233.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geron vs. Pharmather Holdings
Performance |
| Timeline |
| Geron |
| Pharmather Holdings |
Geron and Pharmather Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geron and Pharmather Holdings
The main advantage of trading using opposite Geron and Pharmather Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geron position performs unexpectedly, Pharmather Holdings 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 Pharmather Holdings will offset losses from the drop in Pharmather Holdings' long position.| Geron vs. Viking Therapeutics | Geron vs. TG Therapeutics | Geron vs. X4 Pharmaceuticals | Geron vs. PDS Biotechnology Corp |
| Pharmather Holdings vs. Adial Pharmaceuticals | Pharmather Holdings vs. Transcode Therapeutics | Pharmather Holdings vs. Aditxt Inc | Pharmather Holdings vs. Reviva Pharmaceuticals 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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