Correlation Between Oncology Institute and Guardian Pharmacy

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

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

Diversification Opportunities for Oncology Institute and Guardian Pharmacy

-0.37

Correlation Coefficient

Oncology Institute  Guardian Pharmacy

Very good diversification

The 3 months correlation between Oncology and Guardian is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding The Oncology Institute and Guardian Pharmacy Services, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Pharmacy and Oncology Institute 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 The Oncology Institute are associated (or correlated) with Guardian Pharmacy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Pharmacy has no effect on the direction of Oncology Institute i.e., Oncology Institute and Guardian Pharmacy go up and down completely randomly.

Pair Corralation between Oncology Institute and Guardian Pharmacy

Assuming the 90 days horizon The Oncology Institute is expected to generate 4.49 times more return on investment than Guardian Pharmacy. However, Oncology Institute is 4.49 times more volatile than Guardian Pharmacy Services,. It trades about 0.06 of its potential returns per unit of risk. Guardian Pharmacy Services, is currently generating about 0.25 per unit of risk. If you would invest  1.59  in The Oncology Institute on September 4, 2024 and sell it today you would lose (0.37) from holding The Oncology Institute or give up 23.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.71%
Values	Daily Returns

The Oncology Institute  vs.  Guardian Pharmacy Services,

The Oncology Institute

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in The Oncology Institute are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent forward indicators, Oncology Institute showed solid returns over the last few months and may actually be approaching a breakup point.

Guardian Pharmacy

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Guardian Pharmacy Services, are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Guardian Pharmacy displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Oncology Institute and Guardian Pharmacy

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

The idea behind The Oncology Institute and Guardian Pharmacy Services, 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.