Correlation Between Varex Imaging and Beyond Air
Can any of the company-specific risk be diversified away by investing in both Varex Imaging and Beyond Air 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 Beyond Air 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 Beyond Air, you can compare the effects of market volatilities on Varex Imaging and Beyond Air 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 Beyond Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Varex Imaging and Beyond Air.
Diversification Opportunities for Varex Imaging and Beyond Air
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Varex and Beyond is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Varex Imaging Corp and Beyond Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Air 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 Beyond Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Air has no effect on the direction of Varex Imaging i.e., Varex Imaging and Beyond Air go up and down completely randomly.
Pair Corralation between Varex Imaging and Beyond Air
Given the investment horizon of 90 days Varex Imaging Corp is expected to generate 0.35 times more return on investment than Beyond Air. However, Varex Imaging Corp is 2.9 times less risky than Beyond Air. It trades about 0.0 of its potential returns per unit of risk. Beyond Air is currently generating about -0.03 per unit of risk. If you would invest 1,870 in Varex Imaging Corp on September 1, 2024 and sell it today you would lose (202.00) from holding Varex Imaging Corp or give up 10.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Varex Imaging Corp vs. Beyond Air
Performance |
| Timeline |
| Varex Imaging Corp |
| Beyond Air |
Varex Imaging and Beyond Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Varex Imaging and Beyond Air
The main advantage of trading using opposite Varex Imaging and Beyond Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Varex Imaging position performs unexpectedly, Beyond Air 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 Beyond Air will offset losses from the drop in Beyond Air's long position.| Varex Imaging vs. Sight Sciences | Varex Imaging vs. Apyx Medical | Varex Imaging vs. Si Bone | Varex Imaging vs. Iradimed Co |
| Beyond Air vs. Profound Medical Corp | Beyond Air vs. Si Bone | Beyond Air vs. Nevro Corp | Beyond Air vs. Paragon 28 |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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