Correlation Between Icecure Medical and Cutera
Can any of the company-specific risk be diversified away by investing in both Icecure Medical and Cutera 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 Icecure Medical and Cutera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icecure Medical and Cutera Inc, you can compare the effects of market volatilities on Icecure Medical and Cutera 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 Icecure Medical with a short position of Cutera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icecure Medical and Cutera.
Diversification Opportunities for Icecure Medical and Cutera
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Icecure and Cutera is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Icecure Medical and Cutera Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cutera Inc and Icecure Medical 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 Icecure Medical are associated (or correlated) with Cutera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cutera Inc has no effect on the direction of Icecure Medical i.e., Icecure Medical and Cutera go up and down completely randomly.
Pair Corralation between Icecure Medical and Cutera
Given the investment horizon of 90 days Icecure Medical is expected to generate 0.75 times more return on investment than Cutera. However, Icecure Medical is 1.33 times less risky than Cutera. It trades about -0.01 of its potential returns per unit of risk. Cutera Inc is currently generating about -0.13 per unit of risk. If you would invest 105.00 in Icecure Medical on September 1, 2024 and sell it today you would lose (22.00) from holding Icecure Medical or give up 20.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icecure Medical vs. Cutera Inc
Performance |
| Timeline |
| Icecure Medical |
| Cutera Inc |
Icecure Medical and Cutera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icecure Medical and Cutera
The main advantage of trading using opposite Icecure Medical and Cutera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icecure Medical position performs unexpectedly, Cutera 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 Cutera will offset losses from the drop in Cutera's long position.| Icecure Medical vs. BrainsWay | Icecure Medical vs. SurModics | Icecure Medical vs. STRATA Skin Sciences | Icecure Medical vs. Tenon Medical |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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