Correlation Between Veracyte and NanoString Technologies
Can any of the company-specific risk be diversified away by investing in both Veracyte and NanoString Technologies 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 Veracyte and NanoString Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veracyte and NanoString Technologies, you can compare the effects of market volatilities on Veracyte and NanoString Technologies 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 Veracyte with a short position of NanoString Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veracyte and NanoString Technologies.
Diversification Opportunities for Veracyte and NanoString Technologies
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Veracyte and NanoString is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Veracyte and NanoString Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NanoString Technologies and Veracyte 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 Veracyte are associated (or correlated) with NanoString Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NanoString Technologies has no effect on the direction of Veracyte i.e., Veracyte and NanoString Technologies go up and down completely randomly.
Pair Corralation between Veracyte and NanoString Technologies
Given the investment horizon of 90 days Veracyte is expected to generate 0.6 times more return on investment than NanoString Technologies. However, Veracyte is 1.66 times less risky than NanoString Technologies. It trades about 0.04 of its potential returns per unit of risk. NanoString Technologies is currently generating about -0.03 per unit of risk. If you would invest 2,717 in Veracyte on August 24, 2024 and sell it today you would earn a total of 1,177 from holding Veracyte or generate 43.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 32.06% |
| Values | Daily Returns |
Veracyte vs. NanoString Technologies
Performance |
| Timeline |
| Veracyte |
| NanoString Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Veracyte and NanoString Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veracyte and NanoString Technologies
The main advantage of trading using opposite Veracyte and NanoString Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veracyte position performs unexpectedly, NanoString Technologies 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 NanoString Technologies will offset losses from the drop in NanoString Technologies' long position.| Veracyte vs. Crinetics Pharmaceuticals | Veracyte vs. Viridian Therapeutics | Veracyte vs. Cytokinetics | Veracyte vs. Structure Therapeutics American |
| NanoString Technologies vs. Veracyte | NanoString Technologies vs. Syros Pharmaceuticals | NanoString Technologies vs. Seres Therapeutics | NanoString Technologies vs. Iovance Biotherapeutics |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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