Correlation Between GH Research and Seelos Therapeutics
Can any of the company-specific risk be diversified away by investing in both GH Research and Seelos Therapeutics 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 GH Research and Seelos Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GH Research PLC and Seelos Therapeutics, you can compare the effects of market volatilities on GH Research and Seelos Therapeutics 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 GH Research with a short position of Seelos Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GH Research and Seelos Therapeutics.
Diversification Opportunities for GH Research and Seelos Therapeutics
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between GHRS and Seelos is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding GH Research PLC and Seelos Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seelos Therapeutics and GH Research 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 GH Research PLC are associated (or correlated) with Seelos Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seelos Therapeutics has no effect on the direction of GH Research i.e., GH Research and Seelos Therapeutics go up and down completely randomly.
Pair Corralation between GH Research and Seelos Therapeutics
Given the investment horizon of 90 days GH Research PLC is expected to generate 0.45 times more return on investment than Seelos Therapeutics. However, GH Research PLC is 2.23 times less risky than Seelos Therapeutics. It trades about 0.01 of its potential returns per unit of risk. Seelos Therapeutics is currently generating about -0.13 per unit of risk. 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 | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
GH Research PLC vs. Seelos Therapeutics
Performance |
| Timeline |
| GH Research PLC |
| Seelos Therapeutics |
GH Research and Seelos Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GH Research and Seelos Therapeutics
The main advantage of trading using opposite GH Research and Seelos Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GH Research position performs unexpectedly, Seelos Therapeutics 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 Seelos Therapeutics will offset losses from the drop in Seelos Therapeutics' long position.| GH Research vs. Molecular Partners AG | GH Research vs. MediciNova | GH Research vs. Anebulo Pharmaceuticals | GH Research vs. Champions Oncology |
| Seelos Therapeutics vs. ATAI Life Sciences | Seelos Therapeutics vs. Mind Medicine | Seelos Therapeutics vs. GH Research PLC | Seelos Therapeutics vs. Cybin Inc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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