Correlation Between Profound Medical and Pulmonx Corp
Can any of the company-specific risk be diversified away by investing in both Profound Medical and Pulmonx Corp 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 Profound Medical and Pulmonx Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Profound Medical Corp and Pulmonx Corp, you can compare the effects of market volatilities on Profound Medical and Pulmonx Corp 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 Profound Medical with a short position of Pulmonx Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Profound Medical and Pulmonx Corp.
Diversification Opportunities for Profound Medical and Pulmonx Corp
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Profound and Pulmonx is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Profound Medical Corp and Pulmonx Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pulmonx Corp and Profound 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 Profound Medical Corp are associated (or correlated) with Pulmonx Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pulmonx Corp has no effect on the direction of Profound Medical i.e., Profound Medical and Pulmonx Corp go up and down completely randomly.
Pair Corralation between Profound Medical and Pulmonx Corp
Given the investment horizon of 90 days Profound Medical Corp is expected to generate 0.93 times more return on investment than Pulmonx Corp. However, Profound Medical Corp is 1.07 times less risky than Pulmonx Corp. It trades about 0.13 of its potential returns per unit of risk. Pulmonx Corp is currently generating about 0.05 per unit of risk. If you would invest 735.00 in Profound Medical Corp on September 2, 2024 and sell it today you would earn a total of 77.00 from holding Profound Medical Corp or generate 10.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Profound Medical Corp vs. Pulmonx Corp
Performance |
| Timeline |
| Profound Medical Corp |
| Pulmonx Corp |
Profound Medical and Pulmonx Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Profound Medical and Pulmonx Corp
The main advantage of trading using opposite Profound Medical and Pulmonx Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Profound Medical position performs unexpectedly, Pulmonx Corp 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 Pulmonx Corp will offset losses from the drop in Pulmonx Corp's long position.| Profound Medical vs. Si Bone | Profound Medical vs. Sight Sciences | Profound Medical vs. Nevro Corp | Profound Medical vs. Paragon 28 |
| Pulmonx Corp vs. Iradimed Co | Pulmonx Corp vs. Orthofix Medical | Pulmonx Corp vs. Neuropace | Pulmonx Corp vs. Integer Holdings Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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