Correlation Between Senseonics Holdings and Stryker
Can any of the company-specific risk be diversified away by investing in both Senseonics Holdings and Stryker 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 Senseonics Holdings and Stryker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senseonics Holdings and Stryker, you can compare the effects of market volatilities on Senseonics Holdings and Stryker 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 Senseonics Holdings with a short position of Stryker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senseonics Holdings and Stryker.
Diversification Opportunities for Senseonics Holdings and Stryker
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Senseonics and Stryker is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Senseonics Holdings and Stryker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stryker and Senseonics Holdings 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 Senseonics Holdings are associated (or correlated) with Stryker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stryker has no effect on the direction of Senseonics Holdings i.e., Senseonics Holdings and Stryker go up and down completely randomly.
Pair Corralation between Senseonics Holdings and Stryker
Given the investment horizon of 90 days Senseonics Holdings is expected to under-perform the Stryker. In addition to that, Senseonics Holdings is 3.5 times more volatile than Stryker. It trades about -0.03 of its total potential returns per unit of risk. Stryker is currently generating about 0.08 per unit of volatility. If you would invest 27,269 in Stryker on August 31, 2024 and sell it today you would earn a total of 11,946 from holding Stryker or generate 43.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senseonics Holdings vs. Stryker
Performance |
| Timeline |
| Senseonics Holdings |
| Stryker |
Senseonics Holdings and Stryker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senseonics Holdings and Stryker
The main advantage of trading using opposite Senseonics Holdings and Stryker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senseonics Holdings position performs unexpectedly, Stryker 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 Stryker will offset losses from the drop in Stryker's long position.| Senseonics Holdings vs. Insulet | Senseonics Holdings vs. Tandem Diabetes Care | Senseonics Holdings vs. Abbott Laboratories | Senseonics Holdings vs. Align Technology |
| Stryker vs. Abbott Laboratories | Stryker vs. Medtronic PLC | Stryker vs. Edwards Lifesciences Corp | Stryker vs. ZimVie Inc |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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