Correlation Between Guardion Health and Procaps Group
Can any of the company-specific risk be diversified away by investing in both Guardion Health and Procaps Group 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 Guardion Health and Procaps Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardion Health Sciences and Procaps Group SA, you can compare the effects of market volatilities on Guardion Health and Procaps Group 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 Guardion Health with a short position of Procaps Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardion Health and Procaps Group.
Diversification Opportunities for Guardion Health and Procaps Group
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Guardion and Procaps is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Guardion Health Sciences and Procaps Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Procaps Group SA and Guardion 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 Guardion Health Sciences are associated (or correlated) with Procaps Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Procaps Group SA has no effect on the direction of Guardion Health i.e., Guardion Health and Procaps Group go up and down completely randomly.
Pair Corralation between Guardion Health and Procaps Group
Given the investment horizon of 90 days Guardion Health is expected to generate 43.14 times less return on investment than Procaps Group. But when comparing it to its historical volatility, Guardion Health Sciences is 16.61 times less risky than Procaps Group. It trades about 0.03 of its potential returns per unit of risk. Procaps Group SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 62.00 in Procaps Group SA on August 24, 2024 and sell it today you would lose (60.90) from holding Procaps Group SA or give up 98.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 79.45% |
| Values | Daily Returns |
Guardion Health Sciences vs. Procaps Group SA
Performance |
| Timeline |
| Guardion Health Sciences |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Procaps Group SA |
Guardion Health and Procaps Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardion Health and Procaps Group
The main advantage of trading using opposite Guardion Health and Procaps Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardion Health position performs unexpectedly, Procaps Group 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 Procaps Group will offset losses from the drop in Procaps Group's long position.| Guardion Health vs. Biofrontera | Guardion Health vs. Shuttle Pharmaceuticals | Guardion Health vs. Akanda Corp | Guardion Health vs. China Pharma Holdings |
| Procaps Group vs. Procaps Group SA | Procaps Group vs. Quantum Si incorporated | Procaps Group vs. Jasper Therapeutics |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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