Correlation Between Varex Imaging and Tenon Medical
Can any of the company-specific risk be diversified away by investing in both Varex Imaging and Tenon 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 Varex Imaging and Tenon Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Varex Imaging Corp and Tenon Medical, you can compare the effects of market volatilities on Varex Imaging and Tenon 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 Varex Imaging with a short position of Tenon Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Varex Imaging and Tenon Medical.
Diversification Opportunities for Varex Imaging and Tenon Medical
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Varex and Tenon is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Varex Imaging Corp and Tenon Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tenon Medical and Varex Imaging 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 Varex Imaging Corp are associated (or correlated) with Tenon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tenon Medical has no effect on the direction of Varex Imaging i.e., Varex Imaging and Tenon Medical go up and down completely randomly.
Pair Corralation between Varex Imaging and Tenon Medical
Given the investment horizon of 90 days Varex Imaging Corp is expected to generate 0.22 times more return on investment than Tenon Medical. However, Varex Imaging Corp is 4.62 times less risky than Tenon Medical. It trades about -0.03 of its potential returns per unit of risk. Tenon Medical is currently generating about -0.03 per unit of risk. If you would invest 2,290 in Varex Imaging Corp on September 2, 2024 and sell it today you would lose (622.00) from holding Varex Imaging Corp or give up 27.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Varex Imaging Corp vs. Tenon Medical
Performance |
| Timeline |
| Varex Imaging Corp |
| Tenon Medical |
Varex Imaging and Tenon Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Varex Imaging and Tenon Medical
The main advantage of trading using opposite Varex Imaging and Tenon Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Varex Imaging position performs unexpectedly, Tenon 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 Tenon Medical will offset losses from the drop in Tenon Medical's long position.| Varex Imaging vs. Sight Sciences | Varex Imaging vs. Apyx Medical | Varex Imaging vs. Si Bone | Varex Imaging vs. Iradimed Co |
| Tenon Medical vs. Ainos Inc | Tenon Medical vs. STRATA Skin Sciences | Tenon Medical vs. Neuropace | Tenon Medical vs. Movano Inc |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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