Correlation Between 10X Genomics and Schrodinger

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

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

Diversification Opportunities for 10X Genomics and Schrodinger

0.13

Correlation Coefficient

10X Genomics  Schrodinger

Average diversification

The 3 months correlation between 10X and Schrodinger is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding 10X Genomics and Schrodinger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schrodinger 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 Schrodinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schrodinger has no effect on the direction of 10X Genomics i.e., 10X Genomics and Schrodinger go up and down completely randomly.

Pair Corralation between 10X Genomics and Schrodinger

Considering the 90-day investment horizon 10X Genomics is expected to under-perform the Schrodinger. But the stock apears to be less risky and, when comparing its historical volatility, 10X Genomics is 1.35 times less risky than Schrodinger. The stock trades about -0.01 of its potential returns per unit of risk. The Schrodinger is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  1,874  in Schrodinger on August 30, 2024 and sell it today you would earn a total of  327.00  from holding Schrodinger or generate 17.45% return on investment over 90 days.

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

10X Genomics  vs.  Schrodinger

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 weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Schrodinger

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Schrodinger are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal technical and fundamental indicators, Schrodinger may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with 10X Genomics and Schrodinger

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

The idea behind 10X Genomics and Schrodinger 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.