Correlation Between Guardant Health and Cytosorbents Crp

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

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

Diversification Opportunities for Guardant Health and Cytosorbents Crp

-0.6

Correlation Coefficient

Guardant Health  Cytosorbents Crp

Excellent diversification

The 3 months correlation between Guardant and Cytosorbents is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Cytosorbents Crp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytosorbents Crp and Guardant Health 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 Guardant Health are associated (or correlated) with Cytosorbents Crp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytosorbents Crp has no effect on the direction of Guardant Health i.e., Guardant Health and Cytosorbents Crp go up and down completely randomly.

Pair Corralation between Guardant Health and Cytosorbents Crp

Allowing for the 90-day total investment horizon Guardant Health is expected to generate 0.69 times more return on investment than Cytosorbents Crp. However, Guardant Health is 1.46 times less risky than Cytosorbents Crp. It trades about 0.02 of its potential returns per unit of risk. Cytosorbents Crp is currently generating about 0.0 per unit of risk. If you would invest  3,066  in Guardant Health on October 3, 2024 and sell it today you would lose (12.00) from holding Guardant Health or give up 0.39% of portfolio value over 90 days.

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

Guardant Health  vs.  Cytosorbents Crp

Guardant Health

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guardant Health are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Guardant Health demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Cytosorbents Crp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cytosorbents Crp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Guardant Health and Cytosorbents Crp

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

The idea behind Guardant Health and Cytosorbents Crp 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.