Correlation Between Thermo Fisher and Caredx
Can any of the company-specific risk be diversified away by investing in both Thermo Fisher and Caredx 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 Thermo Fisher and Caredx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thermo Fisher Scientific and Caredx Inc, you can compare the effects of market volatilities on Thermo Fisher and Caredx 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 Thermo Fisher with a short position of Caredx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermo Fisher and Caredx.
Diversification Opportunities for Thermo Fisher and Caredx
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Thermo and Caredx is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Thermo Fisher Scientific and Caredx Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caredx Inc and Thermo Fisher 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 Thermo Fisher Scientific are associated (or correlated) with Caredx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caredx Inc has no effect on the direction of Thermo Fisher i.e., Thermo Fisher and Caredx go up and down completely randomly.
Pair Corralation between Thermo Fisher and Caredx
Considering the 90-day investment horizon Thermo Fisher Scientific is expected to under-perform the Caredx. But the stock apears to be less risky and, when comparing its historical volatility, Thermo Fisher Scientific is 1.8 times less risky than Caredx. The stock trades about -0.26 of its potential returns per unit of risk. The Caredx Inc is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,289 in Caredx Inc on August 28, 2024 and sell it today you would earn a total of 122.00 from holding Caredx Inc or generate 5.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thermo Fisher Scientific vs. Caredx Inc
Performance |
| Timeline |
| Thermo Fisher Scientific |
| Caredx Inc |
Thermo Fisher and Caredx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thermo Fisher and Caredx
The main advantage of trading using opposite Thermo Fisher and Caredx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thermo Fisher position performs unexpectedly, Caredx 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 Caredx will offset losses from the drop in Caredx's long position.| Thermo Fisher vs. Fonar | Thermo Fisher vs. Burning Rock Biotech | Thermo Fisher vs. Sera Prognostics | Thermo Fisher vs. Exagen Inc |
| Caredx vs. Castle Biosciences | Caredx vs. Twist Bioscience Corp | Caredx vs. Biodesix | Caredx vs. Natera 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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