Correlation Between GeneDx Holdings and Barratt Developments
Can any of the company-specific risk be diversified away by investing in both GeneDx Holdings and Barratt Developments 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 GeneDx Holdings and Barratt Developments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GeneDx Holdings Corp and Barratt Developments PLC, you can compare the effects of market volatilities on GeneDx Holdings and Barratt Developments 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 GeneDx Holdings with a short position of Barratt Developments. Check out your portfolio center. Please also check ongoing floating volatility patterns of GeneDx Holdings and Barratt Developments.
Diversification Opportunities for GeneDx Holdings and Barratt Developments
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GeneDx and Barratt is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding GeneDx Holdings Corp and Barratt Developments PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barratt Developments PLC and GeneDx Holdings 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 GeneDx Holdings Corp are associated (or correlated) with Barratt Developments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barratt Developments PLC has no effect on the direction of GeneDx Holdings i.e., GeneDx Holdings and Barratt Developments go up and down completely randomly.
Pair Corralation between GeneDx Holdings and Barratt Developments
Considering the 90-day investment horizon GeneDx Holdings Corp is expected to generate 4.19 times more return on investment than Barratt Developments. However, GeneDx Holdings is 4.19 times more volatile than Barratt Developments PLC. It trades about 0.18 of its potential returns per unit of risk. Barratt Developments PLC is currently generating about -0.03 per unit of risk. If you would invest 386.00 in GeneDx Holdings Corp on December 3, 2024 and sell it today you would earn a total of 10,162 from holding GeneDx Holdings Corp or generate 2632.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.65% |
| Values | Daily Returns |
GeneDx Holdings Corp vs. Barratt Developments PLC
Performance |
| Timeline |
| GeneDx Holdings Corp |
| Barratt Developments PLC |
GeneDx Holdings and Barratt Developments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GeneDx Holdings and Barratt Developments
The main advantage of trading using opposite GeneDx Holdings and Barratt Developments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GeneDx Holdings position performs unexpectedly, Barratt Developments 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 Barratt Developments will offset losses from the drop in Barratt Developments' long position.| GeneDx Holdings vs. Privia Health Group | ||
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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