Correlation Between SurModics and Rapid Micro
Can any of the company-specific risk be diversified away by investing in both SurModics and Rapid Micro 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 Rapid Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SurModics and Rapid Micro Biosystems, you can compare the effects of market volatilities on SurModics and Rapid Micro 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 Rapid Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of SurModics and Rapid Micro.
Diversification Opportunities for SurModics and Rapid Micro
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SurModics and Rapid is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and Rapid Micro Biosystems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rapid Micro Biosystems 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 Rapid Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rapid Micro Biosystems has no effect on the direction of SurModics i.e., SurModics and Rapid Micro go up and down completely randomly.
Pair Corralation between SurModics and Rapid Micro
Given the investment horizon of 90 days SurModics is expected to under-perform the Rapid Micro. But the stock apears to be less risky and, when comparing its historical volatility, SurModics is 3.98 times less risky than Rapid Micro. The stock trades about -0.14 of its potential returns per unit of risk. The Rapid Micro Biosystems is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 114.00 in Rapid Micro Biosystems on November 6, 2024 and sell it today you would earn a total of 65.00 from holding Rapid Micro Biosystems or generate 57.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
SurModics vs. Rapid Micro Biosystems
Performance |
| Timeline |
| SurModics |
| Rapid Micro Biosystems |
SurModics and Rapid Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SurModics and Rapid Micro
The main advantage of trading using opposite SurModics and Rapid Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SurModics position performs unexpectedly, Rapid Micro 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 Rapid Micro will offset losses from the drop in Rapid Micro's long position.| SurModics vs. LivaNova PLC | SurModics vs. Electromed | SurModics vs. Orthopediatrics Corp | SurModics vs. Neuropace |
| Rapid Micro vs. Rxsight | Rapid Micro vs. Axogen Inc | Rapid Micro vs. Treace Medical Concepts | Rapid Micro vs. Pulmonx Corp |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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