Correlation Between Paragon 28 and SurModics
Can any of the company-specific risk be diversified away by investing in both Paragon 28 and SurModics 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 SurModics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Paragon 28 and SurModics, you can compare the effects of market volatilities on Paragon 28 and SurModics 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 SurModics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Paragon 28 and SurModics.
Diversification Opportunities for Paragon 28 and SurModics
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Paragon and SurModics is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Paragon 28 and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics 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 SurModics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SurModics has no effect on the direction of Paragon 28 i.e., Paragon 28 and SurModics go up and down completely randomly.
Pair Corralation between Paragon 28 and SurModics
Considering the 90-day investment horizon Paragon 28 is expected to generate 4.77 times more return on investment than SurModics. However, Paragon 28 is 4.77 times more volatile than SurModics. It trades about 0.11 of its potential returns per unit of risk. SurModics is currently generating about -0.12 per unit of risk. If you would invest 715.00 in Paragon 28 on November 3, 2024 and sell it today you would earn a total of 587.00 from holding Paragon 28 or generate 82.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Paragon 28 vs. SurModics
Performance |
| Timeline |
| Paragon 28 |
| SurModics |
Paragon 28 and SurModics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Paragon 28 and SurModics
The main advantage of trading using opposite Paragon 28 and SurModics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Paragon 28 position performs unexpectedly, SurModics 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 SurModics will offset losses from the drop in SurModics' long position.| Paragon 28 vs. Pulmonx Corp | Paragon 28 vs. Iradimed Co | Paragon 28 vs. Orthofix Medical | Paragon 28 vs. Neuropace |
| SurModics vs. LivaNova PLC | SurModics vs. Electromed | SurModics vs. Orthopediatrics Corp | SurModics vs. Neuropace |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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