Correlation Between STRATA Skin and Brainsway
Can any of the company-specific risk be diversified away by investing in both STRATA Skin and Brainsway 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 STRATA Skin and Brainsway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STRATA Skin Sciences and Brainsway, you can compare the effects of market volatilities on STRATA Skin and Brainsway 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 STRATA Skin with a short position of Brainsway. Check out your portfolio center. Please also check ongoing floating volatility patterns of STRATA Skin and Brainsway.
Diversification Opportunities for STRATA Skin and Brainsway
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between STRATA and Brainsway is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding STRATA Skin Sciences and Brainsway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brainsway and STRATA Skin 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 STRATA Skin Sciences are associated (or correlated) with Brainsway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brainsway has no effect on the direction of STRATA Skin i.e., STRATA Skin and Brainsway go up and down completely randomly.
Pair Corralation between STRATA Skin and Brainsway
Given the investment horizon of 90 days STRATA Skin Sciences is expected to under-perform the Brainsway. But the stock apears to be less risky and, when comparing its historical volatility, STRATA Skin Sciences is 1.01 times less risky than Brainsway. The stock trades about -0.05 of its potential returns per unit of risk. The Brainsway is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 999.00 in Brainsway on August 30, 2024 and sell it today you would lose (31.00) from holding Brainsway or give up 3.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
STRATA Skin Sciences vs. Brainsway
Performance |
| Timeline |
| STRATA Skin Sciences |
| Brainsway |
STRATA Skin and Brainsway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STRATA Skin and Brainsway
The main advantage of trading using opposite STRATA Skin and Brainsway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STRATA Skin position performs unexpectedly, Brainsway 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 Brainsway will offset losses from the drop in Brainsway's long position.| STRATA Skin vs. Axogen Inc | STRATA Skin vs. Ainos Inc | STRATA Skin vs. LENSAR Inc | STRATA Skin vs. Nexalin Technology |
| Brainsway vs. Delcath Systems | Brainsway vs. Paragon 28 | Brainsway vs. USA Equities Corp | Brainsway vs. Venus Concept |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |