Correlation Between US Global and Advanced Proteome

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

By analyzing existing cross correlation between US Global Investors and Advanced Proteome Therapeutics, you can compare the effects of market volatilities on US Global and Advanced Proteome 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 US Global with a short position of Advanced Proteome. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Global and Advanced Proteome.

Diversification Opportunities for US Global and Advanced Proteome

0.0

Correlation Coefficient

US Global  Advanced Proteome

Pay attention - limited upside

The 3 months correlation between GROW and Advanced is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding US Global Investors and Advanced Proteome Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Proteome and US Global 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 US Global Investors are associated (or correlated) with Advanced Proteome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Proteome has no effect on the direction of US Global i.e., US Global and Advanced Proteome go up and down completely randomly.

Pair Corralation between US Global and Advanced Proteome

If you would invest  0.02  in Advanced Proteome Therapeutics on September 12, 2024 and sell it today you would earn a total of  0.00  from holding Advanced Proteome Therapeutics or generate 0.0% return on investment over 90 days.

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

US Global Investors  vs.  Advanced Proteome Therapeutics

US Global Investors

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US Global Investors has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, US Global is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Advanced Proteome

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Advanced Proteome Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Advanced Proteome is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with US Global and Advanced Proteome

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

The idea behind US Global Investors and Advanced Proteome Therapeutics 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.