Correlation Between Sonida Senior and Xtant Medical
Can any of the company-specific risk be diversified away by investing in both Sonida Senior and Xtant Medical 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 Sonida Senior and Xtant Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonida Senior Living and Xtant Medical Holdings, you can compare the effects of market volatilities on Sonida Senior and Xtant Medical 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 Sonida Senior with a short position of Xtant Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonida Senior and Xtant Medical.
Diversification Opportunities for Sonida Senior and Xtant Medical
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sonida and Xtant is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Sonida Senior Living and Xtant Medical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtant Medical Holdings and Sonida Senior 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 Sonida Senior Living are associated (or correlated) with Xtant Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtant Medical Holdings has no effect on the direction of Sonida Senior i.e., Sonida Senior and Xtant Medical go up and down completely randomly.
Pair Corralation between Sonida Senior and Xtant Medical
Given the investment horizon of 90 days Sonida Senior Living is expected to generate 1.55 times more return on investment than Xtant Medical. However, Sonida Senior is 1.55 times more volatile than Xtant Medical Holdings. It trades about 0.12 of its potential returns per unit of risk. Xtant Medical Holdings is currently generating about -0.59 per unit of risk. If you would invest 2,259 in Sonida Senior Living on September 14, 2024 and sell it today you would earn a total of 133.00 from holding Sonida Senior Living or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sonida Senior Living vs. Xtant Medical Holdings
Performance |
| Timeline |
| Sonida Senior Living |
| Xtant Medical Holdings |
Sonida Senior and Xtant Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonida Senior and Xtant Medical
The main advantage of trading using opposite Sonida Senior and Xtant Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonida Senior position performs unexpectedly, Xtant Medical 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 Xtant Medical will offset losses from the drop in Xtant Medical's long position.| Sonida Senior vs. Avita Medical | Sonida Senior vs. Sight Sciences | Sonida Senior vs. Treace Medical Concepts | Sonida Senior vs. Neuropace |
| Xtant Medical vs. Avita Medical | Xtant Medical vs. Sight Sciences | Xtant Medical vs. Treace Medical Concepts | Xtant Medical vs. Neuropace |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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