Correlation Between Exagen and Psychemedics
Can any of the company-specific risk be diversified away by investing in both Exagen and Psychemedics 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 Exagen and Psychemedics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exagen Inc and Psychemedics, you can compare the effects of market volatilities on Exagen and Psychemedics 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 Exagen with a short position of Psychemedics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exagen and Psychemedics.
Diversification Opportunities for Exagen and Psychemedics
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Exagen and Psychemedics is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Exagen Inc and Psychemedics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Psychemedics and Exagen 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 Exagen Inc are associated (or correlated) with Psychemedics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Psychemedics has no effect on the direction of Exagen i.e., Exagen and Psychemedics go up and down completely randomly.
Pair Corralation between Exagen and Psychemedics
Considering the 90-day investment horizon Exagen Inc is expected to generate 14.92 times more return on investment than Psychemedics. However, Exagen is 14.92 times more volatile than Psychemedics. It trades about 0.36 of its potential returns per unit of risk. Psychemedics is currently generating about 0.09 per unit of risk. If you would invest 261.00 in Exagen Inc on August 27, 2024 and sell it today you would earn a total of 149.00 from holding Exagen Inc or generate 57.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exagen Inc vs. Psychemedics
Performance |
| Timeline |
| Exagen Inc |
| Psychemedics |
Exagen and Psychemedics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exagen and Psychemedics
The main advantage of trading using opposite Exagen and Psychemedics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exagen position performs unexpectedly, Psychemedics 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 Psychemedics will offset losses from the drop in Psychemedics' long position.| Exagen vs. Fonar | Exagen vs. Burning Rock Biotech | Exagen vs. Sera Prognostics | Exagen vs. Castle Biosciences |
| Psychemedics vs. Fonar | Psychemedics vs. Burning Rock Biotech | Psychemedics vs. Sera Prognostics | Psychemedics vs. DarioHealth Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |