Correlation Between Utah Medical and ICU Medical
Can any of the company-specific risk be diversified away by investing in both Utah Medical and ICU 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 Utah Medical and ICU Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Utah Medical Products and ICU Medical, you can compare the effects of market volatilities on Utah Medical and ICU 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 Utah Medical with a short position of ICU Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Utah Medical and ICU Medical.
Diversification Opportunities for Utah Medical and ICU Medical
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Utah and ICU is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Utah Medical Products and ICU Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICU Medical and Utah 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 Utah Medical Products are associated (or correlated) with ICU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICU Medical has no effect on the direction of Utah Medical i.e., Utah Medical and ICU Medical go up and down completely randomly.
Pair Corralation between Utah Medical and ICU Medical
Given the investment horizon of 90 days Utah Medical Products is expected to under-perform the ICU Medical. But the stock apears to be less risky and, when comparing its historical volatility, Utah Medical Products is 1.71 times less risky than ICU Medical. The stock trades about 0.0 of its potential returns per unit of risk. The ICU Medical is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 15,798 in ICU Medical on November 2, 2024 and sell it today you would earn a total of 793.00 from holding ICU Medical or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Utah Medical Products vs. ICU Medical
Performance |
| Timeline |
| Utah Medical Products |
| ICU Medical |
Utah Medical and ICU Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Utah Medical and ICU Medical
The main advantage of trading using opposite Utah Medical and ICU Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Utah Medical position performs unexpectedly, ICU 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 ICU Medical will offset losses from the drop in ICU Medical's long position.| Utah Medical vs. Precision Optics, | Utah Medical vs. Repro Med Systems | Utah Medical vs. InfuSystems Holdings | Utah Medical vs. Milestone Scientific |
| ICU Medical vs. Merit Medical Systems | ICU Medical vs. The Cooper Companies, | ICU Medical vs. AngioDynamics | ICU Medical vs. AptarGroup |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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