Correlation Between Sera Prognostics and Applied DNA
Can any of the company-specific risk be diversified away by investing in both Sera Prognostics and Applied DNA 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 Sera Prognostics and Applied DNA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sera Prognostics and Applied DNA Sciences, you can compare the effects of market volatilities on Sera Prognostics and Applied DNA 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 Sera Prognostics with a short position of Applied DNA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sera Prognostics and Applied DNA.
Diversification Opportunities for Sera Prognostics and Applied DNA
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sera and Applied is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sera Prognostics and Applied DNA Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Applied DNA Sciences and Sera Prognostics 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 Sera Prognostics are associated (or correlated) with Applied DNA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Applied DNA Sciences has no effect on the direction of Sera Prognostics i.e., Sera Prognostics and Applied DNA go up and down completely randomly.
Pair Corralation between Sera Prognostics and Applied DNA
Given the investment horizon of 90 days Sera Prognostics is expected to generate 0.83 times more return on investment than Applied DNA. However, Sera Prognostics is 1.21 times less risky than Applied DNA. It trades about 0.05 of its potential returns per unit of risk. Applied DNA Sciences is currently generating about -0.06 per unit of risk. If you would invest 300.00 in Sera Prognostics on August 31, 2024 and sell it today you would earn a total of 374.00 from holding Sera Prognostics or generate 124.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sera Prognostics vs. Applied DNA Sciences
Performance |
| Timeline |
| Sera Prognostics |
| Applied DNA Sciences |
Sera Prognostics and Applied DNA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sera Prognostics and Applied DNA
The main advantage of trading using opposite Sera Prognostics and Applied DNA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sera Prognostics position performs unexpectedly, Applied DNA 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 Applied DNA will offset losses from the drop in Applied DNA's long position.| Sera Prognostics vs. Fonar | Sera Prognostics vs. Burning Rock Biotech | Sera Prognostics vs. Exagen Inc | Sera Prognostics vs. Sotera Health Co |
| Applied DNA vs. Biodesix | Applied DNA vs. DarioHealth Corp | Applied DNA vs. Exagen Inc | Applied DNA vs. Burning Rock Biotech |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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