Correlation Between GelStat Corp and Aditxt

Can any of the company-specific risk be diversified away by investing in both GelStat Corp and Aditxt 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 GelStat Corp and Aditxt into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GelStat Corp and Aditxt Inc, you can compare the effects of market volatilities on GelStat Corp and Aditxt 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 GelStat Corp with a short position of Aditxt. Check out your portfolio center. Please also check ongoing floating volatility patterns of GelStat Corp and Aditxt.

Diversification Opportunities for GelStat Corp and Aditxt

0.32

Correlation Coefficient

GelStat Corp  Aditxt

Weak diversification

The 3 months correlation between GelStat and Aditxt is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding GelStat Corp and Aditxt Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aditxt Inc and GelStat Corp 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 GelStat Corp are associated (or correlated) with Aditxt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aditxt Inc has no effect on the direction of GelStat Corp i.e., GelStat Corp and Aditxt go up and down completely randomly.

Pair Corralation between GelStat Corp and Aditxt

Given the investment horizon of 90 days GelStat Corp is expected to generate 2.8 times more return on investment than Aditxt. However, GelStat Corp is 2.8 times more volatile than Aditxt Inc. It trades about 0.01 of its potential returns per unit of risk. Aditxt Inc is currently generating about -0.19 per unit of risk. If you would invest  0.05  in GelStat Corp on February 19, 2024 and sell it today you would lose (0.02) from holding GelStat Corp or give up 40.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

GelStat Corp  vs.  Aditxt Inc

GelStat Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GelStat Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather fragile basic indicators, GelStat Corp may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Aditxt Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aditxt Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with GelStat Corp and Aditxt

The main advantage of trading using opposite GelStat Corp and Aditxt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GelStat Corp position performs unexpectedly, Aditxt 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 Aditxt will offset losses from the drop in Aditxt's long position.

The idea behind GelStat Corp and Aditxt Inc 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.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..