Correlation Between Castle Biosciences and Agilent Technologies
Can any of the company-specific risk be diversified away by investing in both Castle Biosciences and Agilent 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 Castle Biosciences and Agilent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Castle Biosciences and Agilent Technologies, you can compare the effects of market volatilities on Castle Biosciences and Agilent 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 Castle Biosciences with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Castle Biosciences and Agilent Technologies.
Diversification Opportunities for Castle Biosciences and Agilent Technologies
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Castle and Agilent is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Castle Biosciences and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and Castle Biosciences 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 Castle Biosciences are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Castle Biosciences i.e., Castle Biosciences and Agilent Technologies go up and down completely randomly.
Pair Corralation between Castle Biosciences and Agilent Technologies
Given the investment horizon of 90 days Castle Biosciences is expected to under-perform the Agilent Technologies. In addition to that, Castle Biosciences is 1.82 times more volatile than Agilent Technologies. It trades about -0.14 of its total potential returns per unit of risk. Agilent Technologies is currently generating about 0.02 per unit of volatility. If you would invest 13,384 in Agilent Technologies on September 23, 2024 and sell it today you would earn a total of 67.00 from holding Agilent Technologies or generate 0.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Castle Biosciences vs. Agilent Technologies
Performance |
Timeline |
Castle Biosciences |
Agilent Technologies |
Castle Biosciences and Agilent Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Castle Biosciences and Agilent Technologies
The main advantage of trading using opposite Castle Biosciences and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Castle Biosciences position performs unexpectedly, Agilent 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.Castle Biosciences vs. Caredx Inc | Castle Biosciences vs. Twist Bioscience Corp | Castle Biosciences vs. Biodesix | Castle Biosciences vs. Natera Inc |
Agilent Technologies vs. Twist Bioscience Corp | Agilent Technologies vs. Natera Inc | Agilent Technologies vs. Guardant Health | Agilent Technologies vs. Castle Biosciences |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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