Correlation Between Electromed and Apyx Medical
Can any of the company-specific risk be diversified away by investing in both Electromed and Apyx 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 Electromed and Apyx Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electromed and Apyx Medical, you can compare the effects of market volatilities on Electromed and Apyx 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 Electromed with a short position of Apyx Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electromed and Apyx Medical.
Diversification Opportunities for Electromed and Apyx Medical
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Electromed and Apyx is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and Apyx Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apyx Medical and Electromed 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 Electromed are associated (or correlated) with Apyx Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apyx Medical has no effect on the direction of Electromed i.e., Electromed and Apyx Medical go up and down completely randomly.
Pair Corralation between Electromed and Apyx Medical
Given the investment horizon of 90 days Electromed is expected to generate 0.61 times more return on investment than Apyx Medical. However, Electromed is 1.63 times less risky than Apyx Medical. It trades about 0.16 of its potential returns per unit of risk. Apyx Medical is currently generating about -0.01 per unit of risk. If you would invest 1,002 in Electromed on November 3, 2024 and sell it today you would earn a total of 2,438 from holding Electromed or generate 243.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electromed vs. Apyx Medical
Performance |
| Timeline |
| Electromed |
| Apyx Medical |
Electromed and Apyx Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electromed and Apyx Medical
The main advantage of trading using opposite Electromed and Apyx Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electromed position performs unexpectedly, Apyx 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 Apyx Medical will offset losses from the drop in Apyx Medical's long position.| Electromed vs. Neuropace | Electromed vs. Orthopediatrics Corp | Electromed vs. SurModics | Electromed vs. Paragon 28 |
| Apyx Medical vs. Neuropace | Apyx Medical vs. Inogen Inc | Apyx Medical vs. SurModics | Apyx Medical vs. Pulmonx Corp |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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