Correlation Between AtriCure and ICU Medical
Can any of the company-specific risk be diversified away by investing in both AtriCure and ICU 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 AtriCure and ICU Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AtriCure and ICU Medical, you can compare the effects of market volatilities on AtriCure and ICU 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 AtriCure with a short position of ICU Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of AtriCure and ICU Medical.
Diversification Opportunities for AtriCure and ICU Medical
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AtriCure and ICU is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding AtriCure and ICU Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICU Medical and AtriCure 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 AtriCure are associated (or correlated) with ICU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICU Medical has no effect on the direction of AtriCure i.e., AtriCure and ICU Medical go up and down completely randomly.
Pair Corralation between AtriCure and ICU Medical
Given the investment horizon of 90 days AtriCure is expected to under-perform the ICU Medical. In addition to that, AtriCure is 1.48 times more volatile than ICU Medical. It trades about -0.34 of its total potential returns per unit of risk. ICU Medical is currently generating about -0.18 per unit of volatility. If you would invest 10,543 in ICU Medical on February 1, 2024 and sell it today you would lose (803.00) from holding ICU Medical or give up 7.62% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
AtriCure vs. ICU Medical
Performance |
Timeline |
AtriCure |
ICU Medical |
AtriCure and ICU Medical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AtriCure and ICU Medical
The main advantage of trading using opposite AtriCure and ICU Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AtriCure position performs unexpectedly, ICU 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 ICU Medical will offset losses from the drop in ICU Medical's long position.AtriCure vs. Novo Integrated Sciences | AtriCure vs. HCA Holdings | AtriCure vs. Acadia Healthcare | AtriCure vs. Pennant Group |
ICU Medical vs. Novo Integrated Sciences | ICU Medical vs. HCA Holdings | ICU Medical vs. Acadia Healthcare | ICU Medical vs. Pennant Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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