Correlation Between Rollins and Phathom Pharmaceuticals

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

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

Diversification Opportunities for Rollins and Phathom Pharmaceuticals

0.55

Correlation Coefficient

Rollins  Phathom Pharmaceuticals

Very weak diversification

The 3 months correlation between Rollins and Phathom is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Rollins and Phathom Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phathom Pharmaceuticals and Rollins 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 Rollins are associated (or correlated) with Phathom Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phathom Pharmaceuticals has no effect on the direction of Rollins i.e., Rollins and Phathom Pharmaceuticals go up and down completely randomly.

Pair Corralation between Rollins and Phathom Pharmaceuticals

Considering the 90-day investment horizon Rollins is expected to generate 2.78 times less return on investment than Phathom Pharmaceuticals. But when comparing it to its historical volatility, Rollins is 2.1 times less risky than Phathom Pharmaceuticals. It trades about 0.08 of its potential returns per unit of risk. Phathom Pharmaceuticals is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  1,234  in Phathom Pharmaceuticals on September 5, 2025 and sell it today you would earn a total of  236.00  from holding Phathom Pharmaceuticals or generate 19.12% return on investment over 90 days.

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

Rollins  vs.  Phathom Pharmaceuticals

Rollins

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Rollins are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile basic indicators, Rollins may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Phathom Pharmaceuticals

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Phathom Pharmaceuticals are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Phathom Pharmaceuticals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rollins and Phathom Pharmaceuticals

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

The idea behind Rollins and Phathom Pharmaceuticals 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.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.