Correlation Between InMode and Silk Road
Can any of the company-specific risk be diversified away by investing in both InMode and Silk Road 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 Silk Road into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InMode and Silk Road Medical, you can compare the effects of market volatilities on InMode and Silk Road 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 Silk Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of InMode and Silk Road.
Diversification Opportunities for InMode and Silk Road
Poor diversification
The 3 months correlation between InMode and Silk is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding InMode and Silk Road Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silk Road Medical 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 Silk Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silk Road Medical has no effect on the direction of InMode i.e., InMode and Silk Road go up and down completely randomly.
Pair Corralation between InMode and Silk Road
If you would invest 1,787 in InMode on August 31, 2024 and sell it today you would earn a total of 162.00 from holding InMode or generate 9.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
InMode vs. Silk Road Medical
Performance |
| Timeline |
| InMode |
| Silk Road Medical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
InMode and Silk Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InMode and Silk Road
The main advantage of trading using opposite InMode and Silk Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InMode position performs unexpectedly, Silk Road 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 Silk Road will offset losses from the drop in Silk Road's long position.| InMode vs. TransMedics Group | InMode vs. Inspire Medical Systems | InMode vs. Inari Medical | InMode vs. Insulet |
| Silk Road vs. LivaNova PLC | Silk Road vs. Orthopediatrics Corp | Silk Road vs. Pulmonx Corp | Silk Road vs. Si Bone |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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