Correlation Between Femasys and Dentsply Sirona

Can any of the company-specific risk be diversified away by investing in both Femasys and Dentsply Sirona 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 Femasys and Dentsply Sirona into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Femasys and Dentsply Sirona, you can compare the effects of market volatilities on Femasys and Dentsply Sirona 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 Femasys with a short position of Dentsply Sirona. Check out your portfolio center. Please also check ongoing floating volatility patterns of Femasys and Dentsply Sirona.

Diversification Opportunities for Femasys and Dentsply Sirona

-0.21

Correlation Coefficient

Femasys  Dentsply Sirona

Very good diversification

The 3 months correlation between Femasys and Dentsply is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Femasys and Dentsply Sirona in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dentsply Sirona and Femasys 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 Femasys are associated (or correlated) with Dentsply Sirona. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dentsply Sirona has no effect on the direction of Femasys i.e., Femasys and Dentsply Sirona go up and down completely randomly.

Pair Corralation between Femasys and Dentsply Sirona

Given the investment horizon of 90 days Femasys is expected to under-perform the Dentsply Sirona. In addition to that, Femasys is 3.3 times more volatile than Dentsply Sirona. It trades about -0.32 of its total potential returns per unit of risk. Dentsply Sirona is currently generating about -0.21 per unit of volatility. If you would invest  3,225  in Dentsply Sirona on January 31, 2024 and sell it today you would lose (156.00) from holding Dentsply Sirona or give up 4.84% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Femasys  vs.  Dentsply Sirona

Femasys

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Femasys are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain primary indicators, Femasys showed solid returns over the last few months and may actually be approaching a breakup point.

Dentsply Sirona

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dentsply Sirona has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Femasys and Dentsply Sirona

The main advantage of trading using opposite Femasys and Dentsply Sirona positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Femasys position performs unexpectedly, Dentsply Sirona 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 Dentsply Sirona will offset losses from the drop in Dentsply Sirona's long position.

The idea behind Femasys and Dentsply Sirona pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.