Correlation Between Semler Scientific and Planet 13

Can any of the company-specific risk be diversified away by investing in both Semler Scientific and Planet 13 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 Semler Scientific and Planet 13 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Semler Scientific and Planet 13 Holdings, you can compare the effects of market volatilities on Semler Scientific and Planet 13 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 Semler Scientific with a short position of Planet 13. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semler Scientific and Planet 13.

Diversification Opportunities for Semler Scientific and Planet 13

-0.95

Correlation Coefficient

Semler Scientific  Planet 13

Pay attention - limited upside

The 3 months correlation between Semler and Planet is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding Semler Scientific and Planet 13 Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet 13 Holdings and Semler Scientific 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 Semler Scientific are associated (or correlated) with Planet 13. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet 13 Holdings has no effect on the direction of Semler Scientific i.e., Semler Scientific and Planet 13 go up and down completely randomly.

Pair Corralation between Semler Scientific and Planet 13

Given the investment horizon of 90 days Semler Scientific is expected to generate 0.95 times more return on investment than Planet 13. However, Semler Scientific is 1.05 times less risky than Planet 13. It trades about 0.04 of its potential returns per unit of risk. Planet 13 Holdings is currently generating about -0.02 per unit of risk. If you would invest  3,927  in Semler Scientific on October 3, 2024 and sell it today you would earn a total of  1,473  from holding Semler Scientific or generate 37.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	66.46%
Values	Daily Returns

Semler Scientific  vs.  Planet 13 Holdings

Semler Scientific

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Semler Scientific are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak essential indicators, Semler Scientific reported solid returns over the last few months and may actually be approaching a breakup point.

Planet 13 Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Planet 13 Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Semler Scientific and Planet 13

The main advantage of trading using opposite Semler Scientific and Planet 13 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semler Scientific position performs unexpectedly, Planet 13 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 Planet 13 will offset losses from the drop in Planet 13's long position.

The idea behind Semler Scientific and Planet 13 Holdings 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.