Correlation Between Anika Therapeutics and Orthofix Medical
Can any of the company-specific risk be diversified away by investing in both Anika Therapeutics and Orthofix 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 Anika Therapeutics and Orthofix Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anika Therapeutics and Orthofix Medical, you can compare the effects of market volatilities on Anika Therapeutics and Orthofix 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 Anika Therapeutics with a short position of Orthofix Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anika Therapeutics and Orthofix Medical.
Diversification Opportunities for Anika Therapeutics and Orthofix Medical
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anika and Orthofix is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Anika Therapeutics and Orthofix Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orthofix Medical and Anika 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 Anika Therapeutics are associated (or correlated) with Orthofix Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orthofix Medical has no effect on the direction of Anika Therapeutics i.e., Anika Therapeutics and Orthofix Medical go up and down completely randomly.
Pair Corralation between Anika Therapeutics and Orthofix Medical
Given the investment horizon of 90 days Anika Therapeutics is expected to generate 3.8 times less return on investment than Orthofix Medical. But when comparing it to its historical volatility, Anika Therapeutics is 1.06 times less risky than Orthofix Medical. It trades about 0.02 of its potential returns per unit of risk. Orthofix Medical is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,733 in Orthofix Medical on November 2, 2024 and sell it today you would earn a total of 132.00 from holding Orthofix Medical or generate 7.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anika Therapeutics vs. Orthofix Medical
Performance |
| Timeline |
| Anika Therapeutics |
| Orthofix Medical |
Anika Therapeutics and Orthofix Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anika Therapeutics and Orthofix Medical
The main advantage of trading using opposite Anika Therapeutics and Orthofix Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anika Therapeutics position performs unexpectedly, Orthofix 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 Orthofix Medical will offset losses from the drop in Orthofix Medical's long position.| Anika Therapeutics vs. Axogen Inc | Anika Therapeutics vs. Orthofix Medical | Anika Therapeutics vs. SurModics | Anika Therapeutics vs. Paragon 28 |
| Orthofix Medical vs. Globus Medical | Orthofix Medical vs. CONMED | Orthofix Medical vs. Alphatec Holdings | Orthofix Medical vs. LivaNova PLC |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |