Correlation Between Guardant Health and Mednax
Can any of the company-specific risk be diversified away by investing in both Guardant Health and Mednax 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 Guardant Health and Mednax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardant Health and Mednax Inc, you can compare the effects of market volatilities on Guardant Health and Mednax 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 Guardant Health with a short position of Mednax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardant Health and Mednax.
Diversification Opportunities for Guardant Health and Mednax
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guardant and Mednax is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Mednax Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mednax Inc and Guardant Health 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 Guardant Health are associated (or correlated) with Mednax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mednax Inc has no effect on the direction of Guardant Health i.e., Guardant Health and Mednax go up and down completely randomly.
Pair Corralation between Guardant Health and Mednax
Allowing for the 90-day total investment horizon Guardant Health is expected to generate 2.56 times more return on investment than Mednax. However, Guardant Health is 2.56 times more volatile than Mednax Inc. It trades about 0.29 of its potential returns per unit of risk. Mednax Inc is currently generating about -0.06 per unit of risk. If you would invest 2,896 in Guardant Health on September 18, 2024 and sell it today you would earn a total of 588.00 from holding Guardant Health or generate 20.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guardant Health vs. Mednax Inc
Performance |
| Timeline |
| Guardant Health |
| Mednax Inc |
Guardant Health and Mednax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardant Health and Mednax
The main advantage of trading using opposite Guardant Health and Mednax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardant Health position performs unexpectedly, Mednax 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 Mednax will offset losses from the drop in Mednax's long position.| Guardant Health vs. Illumina | Guardant Health vs. Twist Bioscience Corp | Guardant Health vs. Natera Inc | Guardant Health vs. Caredx Inc |
| Mednax vs. Acadia Healthcare | Mednax vs. Select Medical Holdings | Mednax vs. Universal Health Services | Mednax vs. Prestige Brand 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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