Correlation Between Baxter International and Inspira Technologies
Can any of the company-specific risk be diversified away by investing in both Baxter International and Inspira Technologies 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 Baxter International and Inspira Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baxter International and Inspira Technologies Oxy, you can compare the effects of market volatilities on Baxter International and Inspira Technologies 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 Baxter International with a short position of Inspira Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baxter International and Inspira Technologies.
Diversification Opportunities for Baxter International and Inspira Technologies
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baxter and Inspira is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Baxter International and Inspira Technologies Oxy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspira Technologies Oxy and Baxter International 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 Baxter International are associated (or correlated) with Inspira Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspira Technologies Oxy has no effect on the direction of Baxter International i.e., Baxter International and Inspira Technologies go up and down completely randomly.
Pair Corralation between Baxter International and Inspira Technologies
Considering the 90-day investment horizon Baxter International is expected to under-perform the Inspira Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Baxter International is 1.5 times less risky than Inspira Technologies. The stock trades about -0.18 of its potential returns per unit of risk. The Inspira Technologies Oxy is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 129.00 in Inspira Technologies Oxy on September 5, 2024 and sell it today you would earn a total of 5.00 from holding Inspira Technologies Oxy or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baxter International vs. Inspira Technologies Oxy
Performance |
| Timeline |
| Baxter International |
| Inspira Technologies Oxy |
Baxter International and Inspira Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baxter International and Inspira Technologies
The main advantage of trading using opposite Baxter International and Inspira Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baxter International position performs unexpectedly, Inspira Technologies 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 Inspira Technologies will offset losses from the drop in Inspira Technologies' long position.| Baxter International vs. Embecta Corp | Baxter International vs. West Pharmaceutical Services | Baxter International vs. ResMed Inc | Baxter International vs. The Cooper Companies, |
| Inspira Technologies vs. Baxter International | Inspira Technologies vs. West Pharmaceutical Services | Inspira Technologies vs. ResMed Inc | Inspira Technologies vs. ICU Medical |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |