Correlation Between Alphatec Holdings and Monogram Orthopaedics

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

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

Diversification Opportunities for Alphatec Holdings and Monogram Orthopaedics

-0.59

Correlation Coefficient

Alphatec Holdings  Monogram Orthopaedics

Excellent diversification

The 3 months correlation between Alphatec and Monogram is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Alphatec Holdings and Monogram Orthopaedics Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monogram Orthopaedics and Alphatec Holdings 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 Alphatec Holdings are associated (or correlated) with Monogram Orthopaedics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monogram Orthopaedics has no effect on the direction of Alphatec Holdings i.e., Alphatec Holdings and Monogram Orthopaedics go up and down completely randomly.

Pair Corralation between Alphatec Holdings and Monogram Orthopaedics

Given the investment horizon of 90 days Alphatec Holdings is expected to under-perform the Monogram Orthopaedics. But the stock apears to be less risky and, when comparing its historical volatility, Alphatec Holdings is 4.21 times less risky than Monogram Orthopaedics. The stock trades about -0.01 of its potential returns per unit of risk. The Monogram Orthopaedics Common is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  288.00  in Monogram Orthopaedics Common on April 29, 2025 and sell it today you would earn a total of  280.00  from holding Monogram Orthopaedics Common or generate 97.22% return on investment over 90 days.

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

Alphatec Holdings  vs.  Monogram Orthopaedics Common

Alphatec Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alphatec Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Alphatec Holdings is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Monogram Orthopaedics

Risk-Adjusted Performance

Good

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

Pair Trading with Alphatec Holdings and Monogram Orthopaedics

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

The idea behind Alphatec Holdings and Monogram Orthopaedics Common 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.