Correlation Between Guardian Pharmacy and Auna SA

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

By analyzing existing cross correlation between Guardian Pharmacy Services, and Auna SA, you can compare the effects of market volatilities on Guardian Pharmacy and Auna SA 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 Guardian Pharmacy with a short position of Auna SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardian Pharmacy and Auna SA.

Diversification Opportunities for Guardian Pharmacy and Auna SA

0.07

Correlation Coefficient

Guardian Pharmacy  Auna SA

Significant diversification

The 3 months correlation between Guardian and Auna is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Guardian Pharmacy Services, and Auna SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auna SA and Guardian Pharmacy 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 Guardian Pharmacy Services, are associated (or correlated) with Auna SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auna SA has no effect on the direction of Guardian Pharmacy i.e., Guardian Pharmacy and Auna SA go up and down completely randomly.

Pair Corralation between Guardian Pharmacy and Auna SA

Given the investment horizon of 90 days Guardian Pharmacy Services, is expected to under-perform the Auna SA. In addition to that, Guardian Pharmacy is 1.81 times more volatile than Auna SA. It trades about -0.24 of its total potential returns per unit of risk. Auna SA is currently generating about 0.01 per unit of volatility. If you would invest  700.00  in Auna SA on October 6, 2024 and sell it today you would earn a total of  1.00  from holding Auna SA or generate 0.14% return on investment over 90 days.

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

Guardian Pharmacy Services,  vs.  Auna SA

Guardian Pharmacy

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Guardian Pharmacy Services, are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Guardian Pharmacy displayed solid returns over the last few months and may actually be approaching a breakup point.

Auna SA

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Auna SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Auna SA is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Guardian Pharmacy and Auna SA

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

The idea behind Guardian Pharmacy Services, and Auna SA 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.