Correlation Between Brainsway and Delcath Systems
Can any of the company-specific risk be diversified away by investing in both Brainsway and Delcath Systems 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 Brainsway and Delcath Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brainsway and Delcath Systems, you can compare the effects of market volatilities on Brainsway and Delcath Systems 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 Brainsway with a short position of Delcath Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brainsway and Delcath Systems.
Diversification Opportunities for Brainsway and Delcath Systems
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Brainsway and Delcath is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Brainsway and Delcath Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delcath Systems and Brainsway 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 Brainsway are associated (or correlated) with Delcath Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delcath Systems has no effect on the direction of Brainsway i.e., Brainsway and Delcath Systems go up and down completely randomly.
Pair Corralation between Brainsway and Delcath Systems
Given the investment horizon of 90 days Brainsway is expected to generate 1.15 times more return on investment than Delcath Systems. However, Brainsway is 1.15 times more volatile than Delcath Systems. It trades about 0.06 of its potential returns per unit of risk. Delcath Systems is currently generating about -0.12 per unit of risk. If you would invest 965.00 in Brainsway on August 26, 2024 and sell it today you would earn a total of 35.00 from holding Brainsway or generate 3.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brainsway vs. Delcath Systems
Performance |
| Timeline |
| Brainsway |
| Delcath Systems |
Brainsway and Delcath Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brainsway and Delcath Systems
The main advantage of trading using opposite Brainsway and Delcath Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brainsway position performs unexpectedly, Delcath Systems 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 Delcath Systems will offset losses from the drop in Delcath Systems' long position.| Brainsway vs. Delcath Systems | Brainsway vs. Paragon 28 | Brainsway vs. USA Equities Corp | Brainsway vs. Venus Concept |
| Delcath Systems vs. Neuropace | Delcath Systems vs. SurModics | Delcath Systems vs. CVRx Inc | Delcath Systems 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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