Correlation Between AVITA Medical and SAFETY MEDICAL
Can any of the company-specific risk be diversified away by investing in both AVITA Medical and SAFETY MEDICAL 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 AVITA Medical and SAFETY MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVITA Medical and SAFETY MEDICAL PROD, you can compare the effects of market volatilities on AVITA Medical and SAFETY MEDICAL 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 AVITA Medical with a short position of SAFETY MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVITA Medical and SAFETY MEDICAL.
Diversification Opportunities for AVITA Medical and SAFETY MEDICAL
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AVITA and SAFETY is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding AVITA Medical and SAFETY MEDICAL PROD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAFETY MEDICAL PROD and AVITA Medical 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 AVITA Medical are associated (or correlated) with SAFETY MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAFETY MEDICAL PROD has no effect on the direction of AVITA Medical i.e., AVITA Medical and SAFETY MEDICAL go up and down completely randomly.
Pair Corralation between AVITA Medical and SAFETY MEDICAL
Assuming the 90 days trading horizon AVITA Medical is expected to generate 1.29 times more return on investment than SAFETY MEDICAL. However, AVITA Medical is 1.29 times more volatile than SAFETY MEDICAL PROD. It trades about 0.25 of its potential returns per unit of risk. SAFETY MEDICAL PROD is currently generating about -0.25 per unit of risk. If you would invest 189.00 in AVITA Medical on September 1, 2024 and sell it today you would earn a total of 47.00 from holding AVITA Medical or generate 24.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AVITA Medical vs. SAFETY MEDICAL PROD
Performance |
| Timeline |
| AVITA Medical |
| SAFETY MEDICAL PROD |
AVITA Medical and SAFETY MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVITA Medical and SAFETY MEDICAL
The main advantage of trading using opposite AVITA Medical and SAFETY MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVITA Medical position performs unexpectedly, SAFETY MEDICAL 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 SAFETY MEDICAL will offset losses from the drop in SAFETY MEDICAL's long position.| AVITA Medical vs. Perma Fix Environmental Services | AVITA Medical vs. RELIANCE STEEL AL | AVITA Medical vs. Caltagirone SpA | AVITA Medical vs. Reliance Steel Aluminum |
| SAFETY MEDICAL vs. MOLSON RS BEVERAGE | SAFETY MEDICAL vs. Molson Coors Beverage | SAFETY MEDICAL vs. ADRIATIC METALS LS 013355 | SAFETY MEDICAL vs. United Insurance Holdings |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |