Correlation Between Aclaris Therapeutics and Global Wholehealth

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

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

Diversification Opportunities for Aclaris Therapeutics and Global Wholehealth

0.0

Correlation Coefficient

Aclaris Therapeutics  Global Wholehealth

Pay attention - limited upside

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

Pair Corralation between Aclaris Therapeutics and Global Wholehealth

If you would invest  123.00  in Aclaris Therapeutics on February 4, 2024 and sell it today you would earn a total of  13.00  from holding Aclaris Therapeutics or generate 10.57% return on investment over 90 days.

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

Aclaris Therapeutics  vs.  Global Wholehealth Partners

Aclaris Therapeutics

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aclaris Therapeutics are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Aclaris Therapeutics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Global Wholehealth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Global Wholehealth Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical indicators, Global Wholehealth is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Aclaris Therapeutics and Global Wholehealth

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

The idea behind Aclaris Therapeutics and Global Wholehealth Partners 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.