Correlation Between SurModics and CVRx
Can any of the company-specific risk be diversified away by investing in both SurModics and CVRx 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 CVRx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SurModics and CVRx Inc, you can compare the effects of market volatilities on SurModics and CVRx 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 CVRx. Check out your portfolio center. Please also check ongoing floating volatility patterns of SurModics and CVRx.
Diversification Opportunities for SurModics and CVRx
Very good diversification
The 3 months correlation between SurModics and CVRx is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and CVRx Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVRx Inc 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 CVRx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVRx Inc has no effect on the direction of SurModics i.e., SurModics and CVRx go up and down completely randomly.
Pair Corralation between SurModics and CVRx
Given the investment horizon of 90 days SurModics is expected to generate 1.63 times less return on investment than CVRx. But when comparing it to its historical volatility, SurModics is 1.99 times less risky than CVRx. It trades about 0.06 of its potential returns per unit of risk. CVRx Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 907.00 in CVRx Inc on August 24, 2024 and sell it today you would earn a total of 578.00 from holding CVRx Inc or generate 63.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SurModics vs. CVRx Inc
Performance |
| Timeline |
| SurModics |
| CVRx Inc |
SurModics and CVRx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SurModics and CVRx
The main advantage of trading using opposite SurModics and CVRx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SurModics position performs unexpectedly, CVRx 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 CVRx will offset losses from the drop in CVRx's long position.| SurModics vs. LivaNova PLC | SurModics vs. Electromed | SurModics vs. Orthopediatrics Corp | SurModics 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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