Correlation Between Xtant Medical and Babcock Wilcox
Can any of the company-specific risk be diversified away by investing in both Xtant Medical and Babcock Wilcox 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 Xtant Medical and Babcock Wilcox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtant Medical Holdings and Babcock Wilcox Enterprises, you can compare the effects of market volatilities on Xtant Medical and Babcock Wilcox 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 Xtant Medical with a short position of Babcock Wilcox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtant Medical and Babcock Wilcox.
Diversification Opportunities for Xtant Medical and Babcock Wilcox
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Xtant and Babcock is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and Babcock Wilcox Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Babcock Wilcox Enter and Xtant 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 Xtant Medical Holdings are associated (or correlated) with Babcock Wilcox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Babcock Wilcox Enter has no effect on the direction of Xtant Medical i.e., Xtant Medical and Babcock Wilcox go up and down completely randomly.
Pair Corralation between Xtant Medical and Babcock Wilcox
Given the investment horizon of 90 days Xtant Medical Holdings is expected to under-perform the Babcock Wilcox. In addition to that, Xtant Medical is 1.33 times more volatile than Babcock Wilcox Enterprises. It trades about -0.58 of its total potential returns per unit of risk. Babcock Wilcox Enterprises is currently generating about 0.05 per unit of volatility. If you would invest 2,116 in Babcock Wilcox Enterprises on September 15, 2024 and sell it today you would earn a total of 24.00 from holding Babcock Wilcox Enterprises or generate 1.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtant Medical Holdings vs. Babcock Wilcox Enterprises
Performance |
| Timeline |
| Xtant Medical Holdings |
| Babcock Wilcox Enter |
Xtant Medical and Babcock Wilcox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtant Medical and Babcock Wilcox
The main advantage of trading using opposite Xtant Medical and Babcock Wilcox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtant Medical position performs unexpectedly, Babcock Wilcox 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 Babcock Wilcox will offset losses from the drop in Babcock Wilcox's long position.| Xtant Medical vs. Avita Medical | Xtant Medical vs. Sight Sciences | Xtant Medical vs. Treace Medical Concepts | Xtant Medical vs. Neuropace |
| Babcock Wilcox vs. Microbot Medical | Babcock Wilcox vs. Cardinal Health | Babcock Wilcox vs. Skechers USA | Babcock Wilcox vs. Xtant Medical Holdings |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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