Correlation Between Cybin and GH Research

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

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

Diversification Opportunities for Cybin and GH Research

0.42

Correlation Coefficient

Cybin  GH Research

Very weak diversification

The 3 months correlation between Cybin and GHRS is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Cybin Inc and GH Research PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GH Research PLC and Cybin 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 Cybin Inc are associated (or correlated) with GH Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GH Research PLC has no effect on the direction of Cybin i.e., Cybin and GH Research go up and down completely randomly.

Pair Corralation between Cybin and GH Research

Given the investment horizon of 90 days Cybin Inc is expected to under-perform the GH Research. But the stock apears to be less risky and, when comparing its historical volatility, Cybin Inc is 1.03 times less risky than GH Research. The stock trades about -0.12 of its potential returns per unit of risk. The GH Research PLC is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  904.00  in GH Research PLC on September 12, 2024 and sell it today you would lose (44.00) from holding GH Research PLC or give up 4.87% of portfolio value over 90 days.

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

Cybin Inc  vs.  GH Research PLC

Cybin Inc

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cybin Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady fundamental drivers, Cybin displayed solid returns over the last few months and may actually be approaching a breakup point.

GH Research PLC

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GH Research PLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, GH Research may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Cybin and GH Research

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

The idea behind Cybin Inc and GH Research PLC 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 Transaction History module to view history of all your transactions and understand their impact on performance.