Correlation Between Paragon Technologies and PacificHealth Laboratories

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

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

Diversification Opportunities for Paragon Technologies and PacificHealth Laboratories

0.0

Correlation Coefficient

Paragon Technologies  PacificHealth Laboratories

Pay attention - limited upside

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

Pair Corralation between Paragon Technologies and PacificHealth Laboratories

If you would invest  955.00  in Paragon Technologies on October 26, 2024 and sell it today you would earn a total of  39.00  from holding Paragon Technologies or generate 4.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

Paragon Technologies  vs.  PacificHealth Laboratories

Paragon Technologies

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Paragon Technologies are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Paragon Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

PacificHealth Laboratories

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PacificHealth Laboratories has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong essential indicators, PacificHealth Laboratories is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Paragon Technologies and PacificHealth Laboratories

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

The idea behind Paragon Technologies and PacificHealth Laboratories 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..