Correlation Between InMode and Ensurge Micropower
Can any of the company-specific risk be diversified away by investing in both InMode and Ensurge Micropower 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 InMode and Ensurge Micropower into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InMode and Ensurge Micropower ASA, you can compare the effects of market volatilities on InMode and Ensurge Micropower 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 InMode with a short position of Ensurge Micropower. Check out your portfolio center. Please also check ongoing floating volatility patterns of InMode and Ensurge Micropower.
Diversification Opportunities for InMode and Ensurge Micropower
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between InMode and Ensurge is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding InMode and Ensurge Micropower ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensurge Micropower ASA and InMode 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 InMode are associated (or correlated) with Ensurge Micropower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensurge Micropower ASA has no effect on the direction of InMode i.e., InMode and Ensurge Micropower go up and down completely randomly.
Pair Corralation between InMode and Ensurge Micropower
Given the investment horizon of 90 days InMode is expected to under-perform the Ensurge Micropower. But the stock apears to be less risky and, when comparing its historical volatility, InMode is 33.49 times less risky than Ensurge Micropower. The stock trades about -0.03 of its potential returns per unit of risk. The Ensurge Micropower ASA is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 404.00 in Ensurge Micropower ASA on September 13, 2024 and sell it today you would lose (375.00) from holding Ensurge Micropower ASA or give up 92.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 76.77% |
| Values | Daily Returns |
InMode vs. Ensurge Micropower ASA
Performance |
| Timeline |
| InMode |
| Ensurge Micropower ASA |
InMode and Ensurge Micropower Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InMode and Ensurge Micropower
The main advantage of trading using opposite InMode and Ensurge Micropower positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InMode position performs unexpectedly, Ensurge Micropower 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 Ensurge Micropower will offset losses from the drop in Ensurge Micropower's long position.| InMode vs. TransMedics Group | InMode vs. Inspire Medical Systems | InMode vs. Inari Medical | InMode vs. Insulet |
| Ensurge Micropower vs. Ensurge Micropower ASA | Ensurge Micropower vs. AAC Clyde Space | Ensurge Micropower vs. Ynvisible Interactive | Ensurge Micropower vs. World Technology Corp |
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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