Correlation Between Tenon Medical and Sight Sciences
Can any of the company-specific risk be diversified away by investing in both Tenon Medical and Sight Sciences 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 Tenon Medical and Sight Sciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tenon Medical and Sight Sciences, you can compare the effects of market volatilities on Tenon Medical and Sight Sciences 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 Tenon Medical with a short position of Sight Sciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tenon Medical and Sight Sciences.
Diversification Opportunities for Tenon Medical and Sight Sciences
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tenon and Sight is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Tenon Medical and Sight Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sight Sciences and Tenon Medical 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 Tenon Medical are associated (or correlated) with Sight Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sight Sciences has no effect on the direction of Tenon Medical i.e., Tenon Medical and Sight Sciences go up and down completely randomly.
Pair Corralation between Tenon Medical and Sight Sciences
Given the investment horizon of 90 days Tenon Medical is expected to under-perform the Sight Sciences. In addition to that, Tenon Medical is 1.24 times more volatile than Sight Sciences. It trades about -0.22 of its total potential returns per unit of risk. Sight Sciences is currently generating about -0.23 per unit of volatility. If you would invest 539.00 in Sight Sciences on August 27, 2024 and sell it today you would lose (138.00) from holding Sight Sciences or give up 25.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tenon Medical vs. Sight Sciences
Performance |
| Timeline |
| Tenon Medical |
| Sight Sciences |
Tenon Medical and Sight Sciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tenon Medical and Sight Sciences
The main advantage of trading using opposite Tenon Medical and Sight Sciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tenon Medical position performs unexpectedly, Sight Sciences 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 Sight Sciences will offset losses from the drop in Sight Sciences' long position.| Tenon Medical vs. Ainos Inc | Tenon Medical vs. STRATA Skin Sciences | Tenon Medical vs. Neuropace | Tenon Medical vs. Movano Inc |
| Sight Sciences vs. Si Bone | Sight Sciences vs. Rapid Micro Biosystems | Sight Sciences vs. Tactile Systems Technology | Sight Sciences 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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