Correlation Between RA Medical and Bone Biologics
Can any of the company-specific risk be diversified away by investing in both RA Medical and Bone Biologics 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 RA Medical and Bone Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RA Medical Systems and Bone Biologics Corp, you can compare the effects of market volatilities on RA Medical and Bone Biologics 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 RA Medical with a short position of Bone Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of RA Medical and Bone Biologics.
Diversification Opportunities for RA Medical and Bone Biologics
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between RMED and Bone is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding RA Medical Systems and Bone Biologics Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bone Biologics Corp and RA 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 RA Medical Systems are associated (or correlated) with Bone Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bone Biologics Corp has no effect on the direction of RA Medical i.e., RA Medical and Bone Biologics go up and down completely randomly.
Pair Corralation between RA Medical and Bone Biologics
If you would invest 98.00 in Bone Biologics Corp on November 3, 2024 and sell it today you would earn a total of 13.00 from holding Bone Biologics Corp or generate 13.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
RA Medical Systems vs. Bone Biologics Corp
Performance |
| Timeline |
| RA Medical Systems |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bone Biologics Corp |
RA Medical and Bone Biologics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RA Medical and Bone Biologics
The main advantage of trading using opposite RA Medical and Bone Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RA Medical position performs unexpectedly, Bone Biologics 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 Bone Biologics will offset losses from the drop in Bone Biologics' long position.| RA Medical vs. SINTX Technologies | RA Medical vs. ReShape Lifesciences | RA Medical vs. Bone Biologics Corp | RA Medical vs. Tivic Health Systems |
| Bone Biologics vs. Bluejay Diagnostics | Bone Biologics vs. Nuwellis | Bone Biologics vs. Heart Test Laboratories | Bone Biologics vs. Tivic Health Systems |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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