Correlation Between Catheter Precision and Electromed
Can any of the company-specific risk be diversified away by investing in both Catheter Precision and Electromed 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 Catheter Precision and Electromed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catheter Precision and Electromed, you can compare the effects of market volatilities on Catheter Precision and Electromed 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 Catheter Precision with a short position of Electromed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catheter Precision and Electromed.
Diversification Opportunities for Catheter Precision and Electromed
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Catheter and Electromed is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Catheter Precision and Electromed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electromed and Catheter Precision 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 Catheter Precision are associated (or correlated) with Electromed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electromed has no effect on the direction of Catheter Precision i.e., Catheter Precision and Electromed go up and down completely randomly.
Pair Corralation between Catheter Precision and Electromed
Given the investment horizon of 90 days Catheter Precision is expected to under-perform the Electromed. In addition to that, Catheter Precision is 2.91 times more volatile than Electromed. It trades about -0.05 of its total potential returns per unit of risk. Electromed is currently generating about 0.08 per unit of volatility. If you would invest 1,196 in Electromed on September 19, 2024 and sell it today you would earn a total of 1,616 from holding Electromed or generate 135.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catheter Precision vs. Electromed
Performance |
| Timeline |
| Catheter Precision |
| Electromed |
Catheter Precision and Electromed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catheter Precision and Electromed
The main advantage of trading using opposite Catheter Precision and Electromed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catheter Precision position performs unexpectedly, Electromed 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 Electromed will offset losses from the drop in Electromed's long position.| Catheter Precision vs. Avita Medical | Catheter Precision vs. Inogen Inc | Catheter Precision vs. Apyx Medical |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |