Correlation Between Outset Medical and Aethlon Medical
Can any of the company-specific risk be diversified away by investing in both Outset Medical and Aethlon Medical 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 Outset Medical and Aethlon Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Outset Medical and Aethlon Medical, you can compare the effects of market volatilities on Outset Medical and Aethlon Medical 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 Outset Medical with a short position of Aethlon Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Outset Medical and Aethlon Medical.
Diversification Opportunities for Outset Medical and Aethlon Medical
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Outset and Aethlon is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Outset Medical and Aethlon Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aethlon Medical and Outset 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 Outset Medical are associated (or correlated) with Aethlon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aethlon Medical has no effect on the direction of Outset Medical i.e., Outset Medical and Aethlon Medical go up and down completely randomly.
Pair Corralation between Outset Medical and Aethlon Medical
Allowing for the 90-day total investment horizon Outset Medical is expected to generate 3.65 times more return on investment than Aethlon Medical. However, Outset Medical is 3.65 times more volatile than Aethlon Medical. It trades about 0.28 of its potential returns per unit of risk. Aethlon Medical is currently generating about -0.09 per unit of risk. If you would invest 70.00 in Outset Medical on September 19, 2024 and sell it today you would earn a total of 37.00 from holding Outset Medical or generate 52.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Outset Medical vs. Aethlon Medical
Performance |
| Timeline |
| Outset Medical |
| Aethlon Medical |
Outset Medical and Aethlon Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Outset Medical and Aethlon Medical
The main advantage of trading using opposite Outset Medical and Aethlon Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Outset Medical position performs unexpectedly, Aethlon Medical 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 Aethlon Medical will offset losses from the drop in Aethlon Medical's long position.| Outset Medical vs. Inari Medical | Outset Medical vs. Clearpoint Neuro | Outset Medical vs. Inspire Medical Systems | Outset Medical vs. Nevro Corp |
| Aethlon Medical vs. Tivic Health Systems | Aethlon Medical vs. Bluejay Diagnostics | Aethlon Medical vs. Heart Test Laboratories | Aethlon Medical vs. Nuwellis |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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