Correlation Between Pasithea Therapeutics and Agilent Technologies

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

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

Diversification Opportunities for Pasithea Therapeutics and Agilent Technologies

0.2

Correlation Coefficient

Pasithea Therapeutics  Agilent Technologies

Modest diversification

The 3 months correlation between Pasithea and Agilent is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Pasithea Therapeutics Corp and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and Pasithea 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 Pasithea Therapeutics Corp are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Pasithea Therapeutics i.e., Pasithea Therapeutics and Agilent Technologies go up and down completely randomly.

Pair Corralation between Pasithea Therapeutics and Agilent Technologies

Assuming the 90 days horizon Pasithea Therapeutics Corp is expected to generate 5.56 times more return on investment than Agilent Technologies. However, Pasithea Therapeutics is 5.56 times more volatile than Agilent Technologies. It trades about -0.01 of its potential returns per unit of risk. Agilent Technologies is currently generating about -0.21 per unit of risk. If you would invest  2.51  in Pasithea Therapeutics Corp on January 11, 2025 and sell it today you would lose (0.51) from holding Pasithea Therapeutics Corp or give up 20.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	38.1%
Values	Daily Returns

Pasithea Therapeutics Corp  vs.  Agilent Technologies

Pasithea Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pasithea Therapeutics Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Agilent Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Agilent Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Pasithea Therapeutics and Agilent Technologies

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

The idea behind Pasithea Therapeutics Corp and Agilent Technologies 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.