Correlation Between Inari Medical and Hyperfine
Can any of the company-specific risk be diversified away by investing in both Inari Medical and Hyperfine 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 Inari Medical and Hyperfine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inari Medical and Hyperfine, you can compare the effects of market volatilities on Inari Medical and Hyperfine 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 Inari Medical with a short position of Hyperfine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inari Medical and Hyperfine.
Diversification Opportunities for Inari Medical and Hyperfine
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Inari and Hyperfine is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Inari Medical and Hyperfine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyperfine and Inari 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 Inari Medical are associated (or correlated) with Hyperfine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyperfine has no effect on the direction of Inari Medical i.e., Inari Medical and Hyperfine go up and down completely randomly.
Pair Corralation between Inari Medical and Hyperfine
Given the investment horizon of 90 days Inari Medical is expected to generate 18.73 times less return on investment than Hyperfine. But when comparing it to its historical volatility, Inari Medical is 113.6 times less risky than Hyperfine. It trades about 0.27 of its potential returns per unit of risk. Hyperfine is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 99.00 in Hyperfine on November 28, 2024 and sell it today you would lose (2.00) from holding Hyperfine or give up 2.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Inari Medical vs. Hyperfine
Performance |
| Timeline |
| Inari Medical |
| Hyperfine |
Inari Medical and Hyperfine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inari Medical and Hyperfine
The main advantage of trading using opposite Inari Medical and Hyperfine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inari Medical position performs unexpectedly, Hyperfine 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 Hyperfine will offset losses from the drop in Hyperfine's long position.The idea behind Inari Medical and Hyperfine pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Hyperfine vs. Neuropace | Hyperfine vs. Orthopediatrics Corp | Hyperfine vs. Anika Therapeutics | Hyperfine vs. PAVmed 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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