Correlation Between Avita Medical and Beyond Air
Can any of the company-specific risk be diversified away by investing in both Avita Medical and Beyond Air 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 Avita Medical and Beyond Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avita Medical and Beyond Air, you can compare the effects of market volatilities on Avita Medical and Beyond Air 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 Avita Medical with a short position of Beyond Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avita Medical and Beyond Air.
Diversification Opportunities for Avita Medical and Beyond Air
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Avita and Beyond is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Avita Medical and Beyond Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Air and Avita 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 Avita Medical are associated (or correlated) with Beyond Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Air has no effect on the direction of Avita Medical i.e., Avita Medical and Beyond Air go up and down completely randomly.
Pair Corralation between Avita Medical and Beyond Air
Given the investment horizon of 90 days Avita Medical is expected to generate 1.75 times less return on investment than Beyond Air. But when comparing it to its historical volatility, Avita Medical is 2.12 times less risky than Beyond Air. It trades about 0.3 of its potential returns per unit of risk. Beyond Air is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 37.00 in Beyond Air on August 24, 2024 and sell it today you would earn a total of 15.00 from holding Beyond Air or generate 40.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avita Medical vs. Beyond Air
Performance |
| Timeline |
| Avita Medical |
| Beyond Air |
Avita Medical and Beyond Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avita Medical and Beyond Air
The main advantage of trading using opposite Avita Medical and Beyond Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avita Medical position performs unexpectedly, Beyond Air 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 Beyond Air will offset losses from the drop in Beyond Air's long position.| Avita Medical vs. Clearpoint Neuro | Avita Medical vs. Sight Sciences | Avita Medical vs. Treace Medical Concepts | Avita Medical vs. Rxsight |
| Beyond Air vs. Lucid Diagnostics | Beyond Air vs. Inari Medical | Beyond Air vs. Clearpoint Neuro | Beyond Air vs. Avita Medical |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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