Correlation Between Penumbra and Owens Minor
Can any of the company-specific risk be diversified away by investing in both Penumbra and Owens Minor 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 Penumbra and Owens Minor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Penumbra and Owens Minor, you can compare the effects of market volatilities on Penumbra and Owens Minor 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 Penumbra with a short position of Owens Minor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penumbra and Owens Minor.
Diversification Opportunities for Penumbra and Owens Minor
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Penumbra and Owens is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Penumbra and Owens Minor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Owens Minor and Penumbra 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 Penumbra are associated (or correlated) with Owens Minor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Owens Minor has no effect on the direction of Penumbra i.e., Penumbra and Owens Minor go up and down completely randomly.
Pair Corralation between Penumbra and Owens Minor
Considering the 90-day investment horizon Penumbra is expected to generate 1.12 times less return on investment than Owens Minor. But when comparing it to its historical volatility, Penumbra is 1.04 times less risky than Owens Minor. It trades about 0.29 of its potential returns per unit of risk. Owens Minor is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,285 in Owens Minor on November 2, 2024 and sell it today you would earn a total of 175.00 from holding Owens Minor or generate 13.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penumbra vs. Owens Minor
Performance |
| Timeline |
| Penumbra |
| Owens Minor |
Penumbra and Owens Minor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penumbra and Owens Minor
The main advantage of trading using opposite Penumbra and Owens Minor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penumbra position performs unexpectedly, Owens Minor 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 Owens Minor will offset losses from the drop in Owens Minor's long position.| Penumbra vs. Insulet | Penumbra vs. TransMedics Group | Penumbra vs. Masimo | Penumbra vs. Inspire Medical Systems |
| Owens Minor vs. Henry Schein | Owens Minor vs. Cardinal Health | Owens Minor vs. Zynex Inc | Owens Minor vs. Patterson Companies |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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