Correlation Between Guardant Health and Neuronetics

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

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

Diversification Opportunities for Guardant Health and Neuronetics

-0.56

Correlation Coefficient

Guardant Health  Neuronetics

Excellent diversification

The 3 months correlation between Guardant and Neuronetics is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Neuronetics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuronetics 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 Neuronetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neuronetics has no effect on the direction of Guardant Health i.e., Guardant Health and Neuronetics go up and down completely randomly.

Pair Corralation between Guardant Health and Neuronetics

Allowing for the 90-day total investment horizon Guardant Health is expected to under-perform the Neuronetics. But the stock apears to be less risky and, when comparing its historical volatility, Guardant Health is 1.18 times less risky than Neuronetics. The stock trades about -0.06 of its potential returns per unit of risk. The Neuronetics is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  446.00  in Neuronetics on May 1, 2025 and sell it today you would earn a total of  1.00  from holding Neuronetics or generate 0.22% return on investment over 90 days.

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

Guardant Health  vs.  Neuronetics

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 latest uncertain performance, the Stock's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Neuronetics

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Neuronetics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Neuronetics is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Guardant Health and Neuronetics

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

The idea behind Guardant Health and Neuronetics 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..