Correlation Between Paragon 28 and Bruker
Can any of the company-specific risk be diversified away by investing in both Paragon 28 and Bruker 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 Paragon 28 and Bruker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Paragon 28 and Bruker, you can compare the effects of market volatilities on Paragon 28 and Bruker 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 Paragon 28 with a short position of Bruker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Paragon 28 and Bruker.
Diversification Opportunities for Paragon 28 and Bruker
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Paragon and Bruker is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Paragon 28 and Bruker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bruker and Paragon 28 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 Paragon 28 are associated (or correlated) with Bruker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bruker has no effect on the direction of Paragon 28 i.e., Paragon 28 and Bruker go up and down completely randomly.
Pair Corralation between Paragon 28 and Bruker
Considering the 90-day investment horizon Paragon 28 is expected to under-perform the Bruker. In addition to that, Paragon 28 is 1.92 times more volatile than Bruker. It trades about -0.01 of its total potential returns per unit of risk. Bruker is currently generating about 0.0 per unit of volatility. If you would invest 6,586 in Bruker on August 28, 2024 and sell it today you would lose (696.00) from holding Bruker or give up 10.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Paragon 28 vs. Bruker
Performance |
| Timeline |
| Paragon 28 |
| Bruker |
Paragon 28 and Bruker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Paragon 28 and Bruker
The main advantage of trading using opposite Paragon 28 and Bruker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Paragon 28 position performs unexpectedly, Bruker 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 Bruker will offset losses from the drop in Bruker's long position.| Paragon 28 vs. Heartbeam | Paragon 28 vs. EUDA Health Holdings | Paragon 28 vs. Nutex Health | Paragon 28 vs. Healthcare Triangle |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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