Correlation Between Venus Concept and American Medical
Can any of the company-specific risk be diversified away by investing in both Venus Concept and American 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 Venus Concept and American Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Venus Concept and American Medical Technologies, you can compare the effects of market volatilities on Venus Concept and American 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 Venus Concept with a short position of American Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Venus Concept and American Medical.
Diversification Opportunities for Venus Concept and American Medical
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Venus and American is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Venus Concept and American Medical Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Medical Tec and Venus Concept 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 Venus Concept are associated (or correlated) with American Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Medical Tec has no effect on the direction of Venus Concept i.e., Venus Concept and American Medical go up and down completely randomly.
Pair Corralation between Venus Concept and American Medical
Given the investment horizon of 90 days Venus Concept is expected to generate 0.55 times more return on investment than American Medical. However, Venus Concept is 1.82 times less risky than American Medical. It trades about -0.02 of its potential returns per unit of risk. American Medical Technologies is currently generating about -0.16 per unit of risk. If you would invest 465.00 in Venus Concept on September 3, 2024 and sell it today you would lose (433.00) from holding Venus Concept or give up 93.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 7.88% |
| Values | Daily Returns |
Venus Concept vs. American Medical Technologies
Performance |
| Timeline |
| Venus Concept |
| American Medical Tec |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Venus Concept and American Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Venus Concept and American Medical
The main advantage of trading using opposite Venus Concept and American Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Venus Concept position performs unexpectedly, American 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 American Medical will offset losses from the drop in American Medical's long position.| Venus Concept vs. Ainos Inc | Venus Concept vs. SurModics | Venus Concept vs. LENSAR Inc | Venus Concept vs. IRIDEX |
| American Medical vs. Milestone Scientific | American Medical vs. Repro Med Systems | American Medical vs. Akoya Biosciences | American Medical vs. Pro Dex |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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