Correlation Between ICU Medical and ENDRA Life
Can any of the company-specific risk be diversified away by investing in both ICU Medical and ENDRA Life 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 ENDRA Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICU Medical and ENDRA Life Sciences, you can compare the effects of market volatilities on ICU Medical and ENDRA Life 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 ENDRA Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICU Medical and ENDRA Life.
Diversification Opportunities for ICU Medical and ENDRA Life
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ICU and ENDRA is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding ICU Medical and ENDRA Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENDRA Life Sciences 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 ENDRA Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENDRA Life Sciences has no effect on the direction of ICU Medical i.e., ICU Medical and ENDRA Life go up and down completely randomly.
Pair Corralation between ICU Medical and ENDRA Life
Given the investment horizon of 90 days ICU Medical is expected to generate 0.18 times more return on investment than ENDRA Life. However, ICU Medical is 5.56 times less risky than ENDRA Life. It trades about -0.19 of its potential returns per unit of risk. ENDRA Life Sciences is currently generating about -0.15 per unit of risk. If you would invest 17,364 in ICU Medical on August 29, 2024 and sell it today you would lose (1,389) from holding ICU Medical or give up 8.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICU Medical vs. ENDRA Life Sciences
Performance |
| Timeline |
| ICU Medical |
| ENDRA Life Sciences |
ICU Medical and ENDRA Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICU Medical and ENDRA Life
The main advantage of trading using opposite ICU Medical and ENDRA Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICU Medical position performs unexpectedly, ENDRA Life 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 ENDRA Life will offset losses from the drop in ENDRA Life's long position.| ICU Medical vs. Femasys | ICU Medical vs. Sharps Technology Warrant | ICU Medical vs. GlucoTrack | ICU Medical vs. Walt Disney |
| ENDRA Life vs. Burning Rock Biotech | ENDRA Life vs. Neuronetics | ENDRA Life vs. DarioHealth Corp | ENDRA Life vs. Sera Prognostics |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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