Correlation Between SurModics and Avanos Medical
Can any of the company-specific risk be diversified away by investing in both SurModics and Avanos 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 SurModics and Avanos Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SurModics and Avanos Medical, you can compare the effects of market volatilities on SurModics and Avanos 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 SurModics with a short position of Avanos Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SurModics and Avanos Medical.
Diversification Opportunities for SurModics and Avanos Medical
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SurModics and Avanos is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and Avanos Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avanos Medical and SurModics 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 SurModics are associated (or correlated) with Avanos Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avanos Medical has no effect on the direction of SurModics i.e., SurModics and Avanos Medical go up and down completely randomly.
Pair Corralation between SurModics and Avanos Medical
Given the investment horizon of 90 days SurModics is expected to generate 0.23 times more return on investment than Avanos Medical. However, SurModics is 4.27 times less risky than Avanos Medical. It trades about 0.0 of its potential returns per unit of risk. Avanos Medical is currently generating about -0.11 per unit of risk. If you would invest 3,956 in SurModics on August 28, 2024 and sell it today you would earn a total of 0.00 from holding SurModics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SurModics vs. Avanos Medical
Performance |
| Timeline |
| SurModics |
| Avanos Medical |
SurModics and Avanos Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SurModics and Avanos Medical
The main advantage of trading using opposite SurModics and Avanos Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SurModics position performs unexpectedly, Avanos 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 Avanos Medical will offset losses from the drop in Avanos Medical's long position.| SurModics vs. LivaNova PLC | SurModics vs. Electromed | SurModics vs. Orthopediatrics Corp | SurModics vs. Neuropace |
| Avanos Medical vs. Artivion | Avanos Medical vs. Anika Therapeutics | Avanos Medical vs. Sight Sciences | Avanos Medical vs. Orthofix 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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