Correlation Between Electromed and Medigus
Can any of the company-specific risk be diversified away by investing in both Electromed and Medigus 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 Medigus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electromed and Medigus Ltd ADR, you can compare the effects of market volatilities on Electromed and Medigus 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 Medigus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electromed and Medigus.
Diversification Opportunities for Electromed and Medigus
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electromed and Medigus is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and Medigus Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medigus Ltd ADR 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 Medigus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medigus Ltd ADR has no effect on the direction of Electromed i.e., Electromed and Medigus go up and down completely randomly.
Pair Corralation between Electromed and Medigus
Given the investment horizon of 90 days Electromed is expected to generate 0.62 times more return on investment than Medigus. However, Electromed is 1.62 times less risky than Medigus. It trades about 0.22 of its potential returns per unit of risk. Medigus Ltd ADR is currently generating about -0.15 per unit of risk. If you would invest 1,462 in Electromed on August 29, 2024 and sell it today you would earn a total of 1,644 from holding Electromed or generate 112.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 11.11% |
| Values | Daily Returns |
Electromed vs. Medigus Ltd ADR
Performance |
| Timeline |
| Electromed |
| Medigus Ltd ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Electromed and Medigus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electromed and Medigus
The main advantage of trading using opposite Electromed and Medigus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electromed position performs unexpectedly, Medigus 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 Medigus will offset losses from the drop in Medigus' long position.| Electromed vs. Neuropace | Electromed vs. Orthopediatrics Corp | Electromed vs. SurModics | Electromed vs. Paragon 28 |
| Medigus vs. Brainsway | Medigus vs. Delcath Systems | Medigus vs. Paragon 28 | Medigus vs. Nexalin Technology |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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