Correlation Between Guardant Health and Agilent Technologies
Can any of the company-specific risk be diversified away by investing in both Guardant Health and Agilent Technologies 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 Guardant Health and Agilent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardant Health and Agilent Technologies, you can compare the effects of market volatilities on Guardant Health and Agilent Technologies 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 Guardant Health with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardant Health and Agilent Technologies.
Diversification Opportunities for Guardant Health and Agilent Technologies
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Guardant and Agilent is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and Guardant Health 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 Guardant Health are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Guardant Health i.e., Guardant Health and Agilent Technologies go up and down completely randomly.
Pair Corralation between Guardant Health and Agilent Technologies
Allowing for the 90-day total investment horizon Guardant Health is expected to under-perform the Agilent Technologies. In addition to that, Guardant Health is 2.91 times more volatile than Agilent Technologies. It trades about -0.15 of its total potential returns per unit of risk. Agilent Technologies is currently generating about -0.01 per unit of volatility. If you would invest 13,392 in Agilent Technologies on January 20, 2024 and sell it today you would lose (148.00) from holding Agilent Technologies or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Guardant Health vs. Agilent Technologies
Performance |
| Timeline |
| Guardant Health |
| Agilent Technologies |
Guardant Health and Agilent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardant Health and Agilent Technologies
The main advantage of trading using opposite Guardant Health and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardant Health position performs unexpectedly, Agilent Technologies 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.| Guardant Health vs. Certara | Guardant Health vs. HealthStream | Guardant Health vs. Evolent Health | Guardant Health vs. Streamline Health Solutions |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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