Correlation Between ICU Medical and Hologic
Can any of the company-specific risk be diversified away by investing in both ICU Medical and Hologic 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 ICU Medical and Hologic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICU Medical and Hologic, you can compare the effects of market volatilities on ICU Medical and Hologic 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 ICU Medical with a short position of Hologic. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICU Medical and Hologic.
Diversification Opportunities for ICU Medical and Hologic
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between ICU and Hologic is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding ICU Medical and Hologic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hologic and ICU 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 ICU Medical are associated (or correlated) with Hologic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hologic has no effect on the direction of ICU Medical i.e., ICU Medical and Hologic go up and down completely randomly.
Pair Corralation between ICU Medical and Hologic
Given the investment horizon of 90 days ICU Medical is expected to generate 1.22 times more return on investment than Hologic. However, ICU Medical is 1.22 times more volatile than Hologic. It trades about 0.04 of its potential returns per unit of risk. Hologic is currently generating about 0.0 per unit of risk. If you would invest 16,310 in ICU Medical on August 28, 2024 and sell it today you would earn a total of 471.00 from holding ICU Medical or generate 2.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICU Medical vs. Hologic
Performance |
| Timeline |
| ICU Medical |
| Hologic |
ICU Medical and Hologic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICU Medical and Hologic
The main advantage of trading using opposite ICU Medical and Hologic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICU Medical position performs unexpectedly, Hologic 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 Hologic will offset losses from the drop in Hologic's long position.| ICU Medical vs. Merit Medical Systems | ICU Medical vs. The Cooper Companies, | ICU Medical vs. AngioDynamics | ICU Medical vs. AptarGroup |
| Hologic vs. Haemonetics | Hologic vs. ICU Medical | Hologic vs. Envista Holdings Corp | Hologic vs. The Cooper Companies, |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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