Correlation Between 10X Genomics and Privia Health

Can any of the company-specific risk be diversified away by investing in both 10X Genomics and Privia Health 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 10X Genomics and Privia Health into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 10X Genomics and Privia Health Group, you can compare the effects of market volatilities on 10X Genomics and Privia Health 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 10X Genomics with a short position of Privia Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of 10X Genomics and Privia Health.

Diversification Opportunities for 10X Genomics and Privia Health

0.4

Correlation Coefficient

10X Genomics  Privia Health

Very weak diversification

The 3 months correlation between 10X and Privia is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding 10X Genomics and Privia Health Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Privia Health Group and 10X Genomics 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 10X Genomics are associated (or correlated) with Privia Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Privia Health Group has no effect on the direction of 10X Genomics i.e., 10X Genomics and Privia Health go up and down completely randomly.

Pair Corralation between 10X Genomics and Privia Health

Considering the 90-day investment horizon 10X Genomics is expected to under-perform the Privia Health. In addition to that, 10X Genomics is 2.21 times more volatile than Privia Health Group. It trades about -0.06 of its total potential returns per unit of risk. Privia Health Group is currently generating about -0.07 per unit of volatility. If you would invest  1,999  in Privia Health Group on July 25, 2024 and sell it today you would lose (236.00) from holding Privia Health Group or give up 11.81% of portfolio value over 90 days.

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

10X Genomics  vs.  Privia Health Group

10X Genomics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 10X Genomics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in November 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Privia Health Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Privia Health Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with 10X Genomics and Privia Health

The main advantage of trading using opposite 10X Genomics and Privia Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 10X Genomics position performs unexpectedly, Privia Health 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 Privia Health will offset losses from the drop in Privia Health's long position.

The idea behind 10X Genomics and Privia Health Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.