Correlation Between Xtant Medical and EMCOR
Can any of the company-specific risk be diversified away by investing in both Xtant Medical and EMCOR 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 EMCOR 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 EMCOR Group, you can compare the effects of market volatilities on Xtant Medical and EMCOR 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 EMCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtant Medical and EMCOR.
Diversification Opportunities for Xtant Medical and EMCOR
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Xtant and EMCOR is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and EMCOR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMCOR Group 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 EMCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMCOR Group has no effect on the direction of Xtant Medical i.e., Xtant Medical and EMCOR go up and down completely randomly.
Pair Corralation between Xtant Medical and EMCOR
Given the investment horizon of 90 days Xtant Medical Holdings is expected to generate 1.23 times more return on investment than EMCOR. However, Xtant Medical is 1.23 times more volatile than EMCOR Group. It trades about 0.16 of its potential returns per unit of risk. EMCOR Group is currently generating about 0.01 per unit of risk. If you would invest 44.00 in Xtant Medical Holdings on November 1, 2024 and sell it today you would earn a total of 7.75 from holding Xtant Medical Holdings or generate 17.61% 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. EMCOR Group
Performance |
| Timeline |
| Xtant Medical Holdings |
| EMCOR Group |
Xtant Medical and EMCOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtant Medical and EMCOR
The main advantage of trading using opposite Xtant Medical and EMCOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtant Medical position performs unexpectedly, EMCOR 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 EMCOR will offset losses from the drop in EMCOR's long position.| Xtant Medical vs. Neuropace | Xtant Medical vs. Electromed | Xtant Medical vs. Orthopediatrics Corp | Xtant Medical vs. SurModics |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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