Correlation Between Plains GP and Seelos Therapeutics
Can any of the company-specific risk be diversified away by investing in both Plains GP 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 Plains GP and Seelos Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plains GP Holdings and Seelos Therapeutics, you can compare the effects of market volatilities on Plains GP 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 Plains GP with a short position of Seelos Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plains GP and Seelos Therapeutics.
Diversification Opportunities for Plains GP and Seelos Therapeutics
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Plains and Seelos is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Plains GP Holdings and Seelos Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seelos Therapeutics and Plains GP 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 Plains GP Holdings 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 Plains GP i.e., Plains GP and Seelos Therapeutics go up and down completely randomly.
Pair Corralation between Plains GP and Seelos Therapeutics
Given the investment horizon of 90 days Plains GP Holdings is expected to generate 0.14 times more return on investment than Seelos Therapeutics. However, Plains GP Holdings is 7.16 times less risky than Seelos Therapeutics. It trades about 0.22 of its potential returns per unit of risk. Seelos Therapeutics is currently generating about -0.5 per unit of risk. If you would invest 1,784 in Plains GP Holdings on November 2, 2024 and sell it today you would earn a total of 429.00 from holding Plains GP Holdings or generate 24.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 20.0% |
| Values | Daily Returns |
Plains GP Holdings vs. Seelos Therapeutics
Performance |
| Timeline |
| Plains GP Holdings |
| Seelos Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Plains GP and Seelos Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plains GP and Seelos Therapeutics
The main advantage of trading using opposite Plains GP and Seelos Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plains GP 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.| Plains GP vs. Targa Resources | Plains GP vs. Western Midstream Partners | Plains GP vs. MPLX LP | Plains GP vs. Plains All American |
| 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |