Correlation Between Microbot Medical and STAAR Surgical
Can any of the company-specific risk be diversified away by investing in both Microbot Medical and STAAR Surgical 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 Microbot Medical and STAAR Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microbot Medical and STAAR Surgical, you can compare the effects of market volatilities on Microbot Medical and STAAR Surgical 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 Microbot Medical with a short position of STAAR Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microbot Medical and STAAR Surgical.
Diversification Opportunities for Microbot Medical and STAAR Surgical
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Microbot and STAAR is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and STAAR Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAAR Surgical and Microbot Medical 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 Microbot Medical are associated (or correlated) with STAAR Surgical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAAR Surgical has no effect on the direction of Microbot Medical i.e., Microbot Medical and STAAR Surgical go up and down completely randomly.
Pair Corralation between Microbot Medical and STAAR Surgical
Given the investment horizon of 90 days Microbot Medical is expected to generate 2.85 times more return on investment than STAAR Surgical. However, Microbot Medical is 2.85 times more volatile than STAAR Surgical. It trades about 0.03 of its potential returns per unit of risk. STAAR Surgical is currently generating about -0.05 per unit of risk. If you would invest 232.00 in Microbot Medical on December 2, 2024 and sell it today you would lose (91.00) from holding Microbot Medical or give up 39.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microbot Medical vs. STAAR Surgical
Performance |
| Timeline |
| Microbot Medical |
| STAAR Surgical |
Microbot Medical and STAAR Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microbot Medical and STAAR Surgical
The main advantage of trading using opposite Microbot Medical and STAAR Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microbot Medical position performs unexpectedly, STAAR Surgical 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 STAAR Surgical will offset losses from the drop in STAAR Surgical's long position.| Microbot Medical vs. Intuitive Surgical | ||
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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