Correlation Between Thermo Fisher and Personalis
Can any of the company-specific risk be diversified away by investing in both Thermo Fisher and Personalis 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 Personalis 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 Personalis, you can compare the effects of market volatilities on Thermo Fisher and Personalis 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 Personalis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermo Fisher and Personalis.
Diversification Opportunities for Thermo Fisher and Personalis
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Thermo and Personalis is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Thermo Fisher Scientific and Personalis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Personalis 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 Personalis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Personalis has no effect on the direction of Thermo Fisher i.e., Thermo Fisher and Personalis go up and down completely randomly.
Pair Corralation between Thermo Fisher and Personalis
Considering the 90-day investment horizon Thermo Fisher Scientific is expected to generate 0.17 times more return on investment than Personalis. However, Thermo Fisher Scientific is 5.91 times less risky than Personalis. It trades about -0.26 of its potential returns per unit of risk. Personalis is currently generating about -0.18 per unit of risk. If you would invest 55,254 in Thermo Fisher Scientific on August 28, 2024 and sell it today you would lose (3,834) from holding Thermo Fisher Scientific or give up 6.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thermo Fisher Scientific vs. Personalis
Performance |
| Timeline |
| Thermo Fisher Scientific |
| Personalis |
Thermo Fisher and Personalis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thermo Fisher and Personalis
The main advantage of trading using opposite Thermo Fisher and Personalis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thermo Fisher position performs unexpectedly, Personalis 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 Personalis will offset losses from the drop in Personalis' long position.| Thermo Fisher vs. Fonar | Thermo Fisher vs. Burning Rock Biotech | Thermo Fisher vs. Sera Prognostics | Thermo Fisher vs. Exagen Inc |
| Personalis vs. Twist Bioscience Corp | Personalis vs. Natera Inc | Personalis vs. Guardant Health | Personalis vs. Castle Biosciences |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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