Correlation Between LENSAR and Heartbeam
Can any of the company-specific risk be diversified away by investing in both LENSAR and Heartbeam 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 LENSAR and Heartbeam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LENSAR Inc and Heartbeam, you can compare the effects of market volatilities on LENSAR and Heartbeam 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 LENSAR with a short position of Heartbeam. Check out your portfolio center. Please also check ongoing floating volatility patterns of LENSAR and Heartbeam.
Diversification Opportunities for LENSAR and Heartbeam
Poor diversification
The 3 months correlation between LENSAR and Heartbeam is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding LENSAR Inc and Heartbeam in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartbeam and LENSAR 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 LENSAR Inc are associated (or correlated) with Heartbeam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartbeam has no effect on the direction of LENSAR i.e., LENSAR and Heartbeam go up and down completely randomly.
Pair Corralation between LENSAR and Heartbeam
Given the investment horizon of 90 days LENSAR Inc is expected to generate 0.86 times more return on investment than Heartbeam. However, LENSAR Inc is 1.16 times less risky than Heartbeam. It trades about 0.11 of its potential returns per unit of risk. Heartbeam is currently generating about 0.08 per unit of risk. If you would invest 215.00 in LENSAR Inc on August 26, 2024 and sell it today you would earn a total of 523.00 from holding LENSAR Inc or generate 243.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LENSAR Inc vs. Heartbeam
Performance |
| Timeline |
| LENSAR Inc |
| Heartbeam |
LENSAR and Heartbeam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LENSAR and Heartbeam
The main advantage of trading using opposite LENSAR and Heartbeam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LENSAR position performs unexpectedly, Heartbeam 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 Heartbeam will offset losses from the drop in Heartbeam's long position.| LENSAR vs. Heartbeam | LENSAR vs. EUDA Health Holdings | LENSAR vs. Nutex Health | LENSAR vs. Healthcare Triangle |
| Heartbeam vs. FOXO Technologies | Heartbeam vs. EUDA Health Holdings | Heartbeam vs. Nutex Health | Heartbeam vs. Healthcare Triangle |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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