Correlation Between Guardant Health and TruBridge

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

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

Diversification Opportunities for Guardant Health and TruBridge

-0.27

Correlation Coefficient

Guardant Health  TruBridge

Very good diversification

The 3 months correlation between Guardant and TruBridge is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and TruBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TruBridge 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 TruBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TruBridge has no effect on the direction of Guardant Health i.e., Guardant Health and TruBridge go up and down completely randomly.

Pair Corralation between Guardant Health and TruBridge

Allowing for the 90-day total investment horizon Guardant Health is expected to generate 1.39 times more return on investment than TruBridge. However, Guardant Health is 1.39 times more volatile than TruBridge. It trades about -0.02 of its potential returns per unit of risk. TruBridge is currently generating about -0.18 per unit of risk. If you would invest  4,405  in Guardant Health on May 4, 2025 and sell it today you would lose (263.00) from holding Guardant Health or give up 5.97% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Guardant Health  vs.  TruBridge

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.

TruBridge

Risk-Adjusted Performance

Very Weak

Over the last 90 days TruBridge has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Guardant Health and TruBridge

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

The idea behind Guardant Health and TruBridge 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.