Correlation Between INVO Bioscience and LENSAR
Can any of the company-specific risk be diversified away by investing in both INVO Bioscience and LENSAR 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 INVO Bioscience and LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INVO Bioscience and LENSAR Inc, you can compare the effects of market volatilities on INVO Bioscience and LENSAR 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 INVO Bioscience with a short position of LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of INVO Bioscience and LENSAR.
Diversification Opportunities for INVO Bioscience and LENSAR
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between INVO and LENSAR is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding INVO Bioscience and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc and INVO Bioscience 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 INVO Bioscience are associated (or correlated) with LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of INVO Bioscience i.e., INVO Bioscience and LENSAR go up and down completely randomly.
Pair Corralation between INVO Bioscience and LENSAR
Given the investment horizon of 90 days INVO Bioscience is expected to generate 1.47 times less return on investment than LENSAR. But when comparing it to its historical volatility, INVO Bioscience is 1.27 times less risky than LENSAR. It trades about 0.29 of its potential returns per unit of risk. LENSAR Inc is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 553.00 in LENSAR Inc on August 31, 2024 and sell it today you would earn a total of 216.00 from holding LENSAR Inc or generate 39.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 50.0% |
| Values | Daily Returns |
INVO Bioscience vs. LENSAR Inc
Performance |
| Timeline |
| INVO Bioscience |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| LENSAR Inc |
INVO Bioscience and LENSAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INVO Bioscience and LENSAR
The main advantage of trading using opposite INVO Bioscience and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INVO Bioscience position performs unexpectedly, LENSAR 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 LENSAR will offset losses from the drop in LENSAR's long position.| INVO Bioscience vs. Entera Bio | INVO Bioscience vs. NLS Pharmaceutics AG | INVO Bioscience vs. Enveric Biosciences | INVO Bioscience vs. Lixte Biotechnology Holdings |
| LENSAR vs. Abbott Laboratories | LENSAR vs. Medtronic PLC | LENSAR vs. Edwards Lifesciences Corp | LENSAR vs. ZimVie Inc |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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