Correlation Between Guardant Health and Retractable Technologies
Can any of the company-specific risk be diversified away by investing in both Guardant Health and Retractable Technologies 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 Retractable Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardant Health and Retractable Technologies, you can compare the effects of market volatilities on Guardant Health and Retractable Technologies 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 Retractable Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardant Health and Retractable Technologies.
Diversification Opportunities for Guardant Health and Retractable Technologies
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guardant and Retractable is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Retractable Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retractable Technologies 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 Retractable Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retractable Technologies has no effect on the direction of Guardant Health i.e., Guardant Health and Retractable Technologies go up and down completely randomly.
Pair Corralation between Guardant Health and Retractable Technologies
Allowing for the 90-day total investment horizon Guardant Health is expected to under-perform the Retractable Technologies. In addition to that, Guardant Health is 1.48 times more volatile than Retractable Technologies. It trades about -0.23 of its total potential returns per unit of risk. Retractable Technologies is currently generating about 0.01 per unit of volatility. If you would invest 80.00 in Retractable Technologies on November 29, 2024 and sell it today you would earn a total of 0.00 from holding Retractable Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Guardant Health vs. Retractable Technologies
Performance |
| Timeline |
| Guardant Health |
| Retractable Technologies |
Guardant Health and Retractable Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardant Health and Retractable Technologies
The main advantage of trading using opposite Guardant Health and Retractable Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardant Health position performs unexpectedly, Retractable Technologies 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 Retractable Technologies will offset losses from the drop in Retractable Technologies' long position.| Guardant Health vs. Illumina | Guardant Health vs. Twist Bioscience Corp | Guardant Health vs. Natera Inc | Guardant Health vs. Caredx Inc |
| Retractable Technologies vs. Milestone Scientific | Retractable Technologies vs. CarPartsCom | Retractable Technologies vs. OncoCyte Corp | Retractable Technologies vs. Alpha Pro Tech |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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