Correlation Between Procter Gamble and GlycoMimetics
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and GlycoMimetics 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 Procter Gamble and GlycoMimetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and GlycoMimetics, you can compare the effects of market volatilities on Procter Gamble and GlycoMimetics 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 Procter Gamble with a short position of GlycoMimetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and GlycoMimetics.
Diversification Opportunities for Procter Gamble and GlycoMimetics
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Procter and GlycoMimetics is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and GlycoMimetics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GlycoMimetics and Procter Gamble 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 Procter Gamble are associated (or correlated) with GlycoMimetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GlycoMimetics has no effect on the direction of Procter Gamble i.e., Procter Gamble and GlycoMimetics go up and down completely randomly.
Pair Corralation between Procter Gamble and GlycoMimetics
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 25.52 times less return on investment than GlycoMimetics. But when comparing it to its historical volatility, Procter Gamble is 34.94 times less risky than GlycoMimetics. It trades about 0.23 of its potential returns per unit of risk. GlycoMimetics is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 17.00 in GlycoMimetics on August 29, 2024 and sell it today you would earn a total of 15.00 from holding GlycoMimetics or generate 88.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. GlycoMimetics
Performance |
| Timeline |
| Procter Gamble |
| GlycoMimetics |
Procter Gamble and GlycoMimetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and GlycoMimetics
The main advantage of trading using opposite Procter Gamble and GlycoMimetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, GlycoMimetics 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 GlycoMimetics will offset losses from the drop in GlycoMimetics' long position.| Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Estee Lauder Companies | Procter Gamble vs. ELF Beauty | Procter Gamble vs. Coty Inc |
| GlycoMimetics vs. Mineralys Therapeutics, Common | GlycoMimetics vs. Foghorn Therapeutics | GlycoMimetics vs. Inventiva Sa | GlycoMimetics vs. Dyne 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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