Correlation Between CVRx and MaxCyte
Can any of the company-specific risk be diversified away by investing in both CVRx and MaxCyte 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 CVRx and MaxCyte into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVRx Inc and MaxCyte, you can compare the effects of market volatilities on CVRx and MaxCyte 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 CVRx with a short position of MaxCyte. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVRx and MaxCyte.
Diversification Opportunities for CVRx and MaxCyte
Excellent diversification
The 3 months correlation between CVRx and MaxCyte is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding CVRx Inc and MaxCyte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MaxCyte and CVRx 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 CVRx Inc are associated (or correlated) with MaxCyte. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MaxCyte has no effect on the direction of CVRx i.e., CVRx and MaxCyte go up and down completely randomly.
Pair Corralation between CVRx and MaxCyte
Given the investment horizon of 90 days CVRx Inc is expected to generate 2.05 times more return on investment than MaxCyte. However, CVRx is 2.05 times more volatile than MaxCyte. It trades about 0.13 of its potential returns per unit of risk. MaxCyte is currently generating about -0.03 per unit of risk. If you would invest 671.00 in CVRx Inc on August 30, 2024 and sell it today you would earn a total of 859.00 from holding CVRx Inc or generate 128.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVRx Inc vs. MaxCyte
Performance |
| Timeline |
| CVRx Inc |
| MaxCyte |
CVRx and MaxCyte Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVRx and MaxCyte
The main advantage of trading using opposite CVRx and MaxCyte positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVRx position performs unexpectedly, MaxCyte 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 MaxCyte will offset losses from the drop in MaxCyte's long position.The idea behind CVRx Inc and MaxCyte 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.| MaxCyte vs. ReShape Lifesciences | MaxCyte vs. Bone Biologics Corp | MaxCyte vs. Tivic Health Systems | MaxCyte vs. Nuwellis |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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