Correlation Between BiodesixInc and GTH
Can any of the company-specific risk be diversified away by investing in both BiodesixInc and GTH 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 BiodesixInc and GTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BiodesixInc and GTH, you can compare the effects of market volatilities on BiodesixInc and GTH 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 BiodesixInc with a short position of GTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of BiodesixInc and GTH.
Diversification Opportunities for BiodesixInc and GTH
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BiodesixInc and GTH is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding BiodesixInc and GTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GTH and BiodesixInc 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 BiodesixInc are associated (or correlated) with GTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GTH has no effect on the direction of BiodesixInc i.e., BiodesixInc and GTH go up and down completely randomly.
Pair Corralation between BiodesixInc and GTH
If you would invest 125.00 in BiodesixInc on February 14, 2024 and sell it today you would earn a total of 27.00 from holding BiodesixInc or generate 21.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 4.55% |
Values | Daily Returns |
BiodesixInc vs. GTH
Performance |
Timeline |
BiodesixInc |
GTH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
BiodesixInc and GTH Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BiodesixInc and GTH
The main advantage of trading using opposite BiodesixInc and GTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BiodesixInc position performs unexpectedly, GTH 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 GTH will offset losses from the drop in GTH's long position.The idea behind BiodesixInc and GTH pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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