Correlation Between Forian and AtriCure
Can any of the company-specific risk be diversified away by investing in both Forian and AtriCure 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 Forian and AtriCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forian Inc and AtriCure, you can compare the effects of market volatilities on Forian and AtriCure 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 Forian with a short position of AtriCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forian and AtriCure.
Diversification Opportunities for Forian and AtriCure
Pay attention - limited upside
The 3 months correlation between Forian and AtriCure is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Forian Inc and AtriCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AtriCure and Forian 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 Forian Inc are associated (or correlated) with AtriCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AtriCure has no effect on the direction of Forian i.e., Forian and AtriCure go up and down completely randomly.
Pair Corralation between Forian and AtriCure
Given the investment horizon of 90 days Forian is expected to generate 1.31 times less return on investment than AtriCure. But when comparing it to its historical volatility, Forian Inc is 1.19 times less risky than AtriCure. It trades about 0.07 of its potential returns per unit of risk. AtriCure is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,483 in AtriCure on August 31, 2024 and sell it today you would earn a total of 134.00 from holding AtriCure or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forian Inc vs. AtriCure
Performance |
| Timeline |
| Forian Inc |
| AtriCure |
Forian and AtriCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forian and AtriCure
The main advantage of trading using opposite Forian and AtriCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forian position performs unexpectedly, AtriCure 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 AtriCure will offset losses from the drop in AtriCure's long position.| Forian vs. HealthStream | Forian vs. National Research Corp | Forian vs. HealthEquity | Forian vs. Health Catalyst |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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