Correlation Between GE HealthCare and 10X Genomics
Can any of the company-specific risk be diversified away by investing in both GE HealthCare and 10X Genomics 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 GE HealthCare and 10X Genomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE HealthCare Technologies and 10X Genomics, you can compare the effects of market volatilities on GE HealthCare and 10X Genomics 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 GE HealthCare with a short position of 10X Genomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE HealthCare and 10X Genomics.
Diversification Opportunities for GE HealthCare and 10X Genomics
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between GEHC and 10X is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding GE HealthCare Technologies and 10X Genomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 10X Genomics and GE HealthCare 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 GE HealthCare Technologies are associated (or correlated) with 10X Genomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 10X Genomics has no effect on the direction of GE HealthCare i.e., GE HealthCare and 10X Genomics go up and down completely randomly.
Pair Corralation between GE HealthCare and 10X Genomics
Given the investment horizon of 90 days GE HealthCare Technologies is expected to generate 0.25 times more return on investment than 10X Genomics. However, GE HealthCare Technologies is 4.08 times less risky than 10X Genomics. It trades about 0.12 of its potential returns per unit of risk. 10X Genomics is currently generating about -0.17 per unit of risk. If you would invest 8,446 in GE HealthCare Technologies on July 25, 2024 and sell it today you would earn a total of 485.00 from holding GE HealthCare Technologies or generate 5.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
GE HealthCare Technologies vs. 10X Genomics
Performance |
Timeline |
GE HealthCare Techno |
10X Genomics |
GE HealthCare and 10X Genomics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GE HealthCare and 10X Genomics
The main advantage of trading using opposite GE HealthCare and 10X Genomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE HealthCare position performs unexpectedly, 10X Genomics 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 10X Genomics will offset losses from the drop in 10X Genomics' long position.GE HealthCare vs. Teladoc | GE HealthCare vs. Veeva Systems Class | GE HealthCare vs. 10X Genomics | GE HealthCare vs. Progyny |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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