Correlation Between Glaukos Corp and Establishment Labs
Can any of the company-specific risk be diversified away by investing in both Glaukos Corp and Establishment Labs 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 Glaukos Corp and Establishment Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glaukos Corp and Establishment Labs Holdings, you can compare the effects of market volatilities on Glaukos Corp and Establishment Labs 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 Glaukos Corp with a short position of Establishment Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glaukos Corp and Establishment Labs.
Diversification Opportunities for Glaukos Corp and Establishment Labs
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Glaukos and Establishment is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Glaukos Corp and Establishment Labs Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Establishment Labs and Glaukos Corp 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 Glaukos Corp are associated (or correlated) with Establishment Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Establishment Labs has no effect on the direction of Glaukos Corp i.e., Glaukos Corp and Establishment Labs go up and down completely randomly.
Pair Corralation between Glaukos Corp and Establishment Labs
Given the investment horizon of 90 days Glaukos Corp is expected to generate 0.75 times more return on investment than Establishment Labs. However, Glaukos Corp is 1.33 times less risky than Establishment Labs. It trades about 0.13 of its potential returns per unit of risk. Establishment Labs Holdings is currently generating about -0.04 per unit of risk. If you would invest 12,994 in Glaukos Corp on August 24, 2024 and sell it today you would earn a total of 1,089 from holding Glaukos Corp or generate 8.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glaukos Corp vs. Establishment Labs Holdings
Performance |
| Timeline |
| Glaukos Corp |
| Establishment Labs |
Glaukos Corp and Establishment Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glaukos Corp and Establishment Labs
The main advantage of trading using opposite Glaukos Corp and Establishment Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glaukos Corp position performs unexpectedly, Establishment Labs 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 Establishment Labs will offset losses from the drop in Establishment Labs' long position.| Glaukos Corp vs. Orthopediatrics Corp | Glaukos Corp vs. CONMED | Glaukos Corp vs. LivaNova PLC | Glaukos Corp vs. Paragon 28 |
| Establishment Labs vs. Orthopediatrics Corp | Establishment Labs vs. Integer Holdings Corp | Establishment Labs vs. Treace Medical Concepts | Establishment Labs vs. CONMED |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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