Correlation Between Integer Holdings and IRhythm Technologies
Can any of the company-specific risk be diversified away by investing in both Integer Holdings and IRhythm Technologies 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 Integer Holdings and IRhythm Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integer Holdings Corp and iRhythm Technologies, you can compare the effects of market volatilities on Integer Holdings and IRhythm Technologies 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 Integer Holdings with a short position of IRhythm Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integer Holdings and IRhythm Technologies.
Diversification Opportunities for Integer Holdings and IRhythm Technologies
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Integer and IRhythm is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Integer Holdings Corp and iRhythm Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iRhythm Technologies and Integer Holdings 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 Integer Holdings Corp are associated (or correlated) with IRhythm Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iRhythm Technologies has no effect on the direction of Integer Holdings i.e., Integer Holdings and IRhythm Technologies go up and down completely randomly.
Pair Corralation between Integer Holdings and IRhythm Technologies
Given the investment horizon of 90 days Integer Holdings Corp is expected to generate 0.55 times more return on investment than IRhythm Technologies. However, Integer Holdings Corp is 1.83 times less risky than IRhythm Technologies. It trades about 0.09 of its potential returns per unit of risk. iRhythm Technologies is currently generating about 0.02 per unit of risk. If you would invest 7,213 in Integer Holdings Corp on November 2, 2024 and sell it today you would earn a total of 7,138 from holding Integer Holdings Corp or generate 98.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Integer Holdings Corp vs. iRhythm Technologies
Performance |
| Timeline |
| Integer Holdings Corp |
| iRhythm Technologies |
Integer Holdings and IRhythm Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Integer Holdings and IRhythm Technologies
The main advantage of trading using opposite Integer Holdings and IRhythm Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integer Holdings position performs unexpectedly, IRhythm Technologies 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 IRhythm Technologies will offset losses from the drop in IRhythm Technologies' long position.| Integer Holdings vs. CONMED | Integer Holdings vs. LivaNova PLC | Integer Holdings vs. iRhythm Technologies | Integer Holdings vs. Pulmonx Corp |
| IRhythm Technologies vs. Integer Holdings Corp | IRhythm Technologies vs. CONMED | IRhythm Technologies vs. LivaNova PLC | IRhythm Technologies vs. Orthopediatrics 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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