Correlation Between Apyx Medical and Sight Sciences

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

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

Diversification Opportunities for Apyx Medical and Sight Sciences

0.55

Correlation Coefficient

Apyx Medical  Sight Sciences

Very weak diversification

The 3 months correlation between Apyx and Sight is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Apyx Medical and Sight Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sight Sciences and Apyx 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 Apyx Medical are associated (or correlated) with Sight Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sight Sciences has no effect on the direction of Apyx Medical i.e., Apyx Medical and Sight Sciences go up and down completely randomly.

Pair Corralation between Apyx Medical and Sight Sciences

Given the investment horizon of 90 days Apyx Medical is expected to under-perform the Sight Sciences. In addition to that, Apyx Medical is 1.01 times more volatile than Sight Sciences. It trades about -0.01 of its total potential returns per unit of risk. Sight Sciences is currently generating about 0.04 per unit of volatility. If you would invest  631.00  in Sight Sciences on June 29, 2024 and sell it today you would earn a total of  26.00  from holding Sight Sciences or generate 4.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Apyx Medical  vs.  Sight Sciences

Apyx Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apyx Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Apyx Medical is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Sight Sciences

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sight Sciences are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical indicators, Sight Sciences may actually be approaching a critical reversion point that can send shares even higher in October 2024.

Pair Trading with Apyx Medical and Sight Sciences

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

The idea behind Apyx Medical and Sight Sciences 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.

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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.