Correlation Between Guardant Health and Simulations Plus

Can any of the company-specific risk be diversified away by investing in both Guardant Health and Simulations Plus 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 Simulations Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guardant Health and Simulations Plus, you can compare the effects of market volatilities on Guardant Health and Simulations Plus 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 Simulations Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardant Health and Simulations Plus.

Diversification Opportunities for Guardant Health and Simulations Plus

-0.54

Correlation Coefficient

Guardant Health  Simulations Plus

Excellent diversification

The 3 months correlation between Guardant and Simulations is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Simulations Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simulations Plus 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 Simulations Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simulations Plus has no effect on the direction of Guardant Health i.e., Guardant Health and Simulations Plus go up and down completely randomly.

Pair Corralation between Guardant Health and Simulations Plus

Allowing for the 90-day total investment horizon Guardant Health is expected to generate 0.5 times more return on investment than Simulations Plus. However, Guardant Health is 2.0 times less risky than Simulations Plus. It trades about -0.02 of its potential returns per unit of risk. Simulations Plus is currently generating about -0.25 per unit of risk. If you would invest  4,830  in Guardant Health on April 25, 2025 and sell it today you would lose (281.00) from holding Guardant Health or give up 5.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Guardant Health  vs.  Simulations Plus

Guardant Health

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guardant Health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Guardant Health is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Simulations Plus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Simulations Plus has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's essential indicators remain relatively invariable which may send shares a bit higher in August 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Guardant Health and Simulations Plus

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

The idea behind Guardant Health and Simulations Plus 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.