Correlation Between Design Therapeutics and SurModics

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

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

Diversification Opportunities for Design Therapeutics and SurModics

-0.58

Correlation Coefficient

Design Therapeutics  SurModics

Excellent diversification

The 3 months correlation between Design and SurModics is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Design Therapeutics and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics and Design Therapeutics 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 Design Therapeutics are associated (or correlated) with SurModics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SurModics has no effect on the direction of Design Therapeutics i.e., Design Therapeutics and SurModics go up and down completely randomly.

Pair Corralation between Design Therapeutics and SurModics

Given the investment horizon of 90 days Design Therapeutics is expected to generate 0.9 times more return on investment than SurModics. However, Design Therapeutics is 1.11 times less risky than SurModics. It trades about 0.14 of its potential returns per unit of risk. SurModics is currently generating about 0.05 per unit of risk. If you would invest  516.00  in Design Therapeutics on August 14, 2025 and sell it today you would earn a total of  260.00  from holding Design Therapeutics or generate 50.39% return on investment over 90 days.

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

Design Therapeutics  vs.  SurModics

Design Therapeutics

Risk-Adjusted Performance

Good

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

SurModics

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental indicators, SurModics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Design Therapeutics and SurModics

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

The idea behind Design Therapeutics and SurModics 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..