Correlation Between Serina Therapeutics and Waste Management

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

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

Diversification Opportunities for Serina Therapeutics and Waste Management

-0.63

Correlation Coefficient

Serina Therapeutics  Waste Management

Excellent diversification

The 3 months correlation between Serina and Waste is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Serina Therapeutics and Waste Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Waste Management and Serina 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 Serina Therapeutics are associated (or correlated) with Waste Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Waste Management has no effect on the direction of Serina Therapeutics i.e., Serina Therapeutics and Waste Management go up and down completely randomly.

Pair Corralation between Serina Therapeutics and Waste Management

Considering the 90-day investment horizon Serina Therapeutics is expected to under-perform the Waste Management. In addition to that, Serina Therapeutics is 6.89 times more volatile than Waste Management. It trades about -0.03 of its total potential returns per unit of risk. Waste Management is currently generating about -0.02 per unit of volatility. If you would invest  20,683  in Waste Management on September 24, 2024 and sell it today you would lose (303.00) from holding Waste Management or give up 1.46% of portfolio value over 90 days.

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

Serina Therapeutics  vs.  Waste Management

Serina Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Serina Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with abnormal performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Waste Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Waste Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Waste Management is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Serina Therapeutics and Waste Management

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

The idea behind Serina Therapeutics and Waste Management 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 Commodity Directory module to find actively traded commodities issued by global exchanges.