Correlation Between InMode and Penumbra
Can any of the company-specific risk be diversified away by investing in both InMode and Penumbra 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 InMode and Penumbra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InMode and Penumbra, you can compare the effects of market volatilities on InMode and Penumbra 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 InMode with a short position of Penumbra. Check out your portfolio center. Please also check ongoing floating volatility patterns of InMode and Penumbra.
Diversification Opportunities for InMode and Penumbra
Good diversification
The 3 months correlation between InMode and Penumbra is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding InMode and Penumbra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penumbra and InMode 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 InMode are associated (or correlated) with Penumbra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penumbra has no effect on the direction of InMode i.e., InMode and Penumbra go up and down completely randomly.
Pair Corralation between InMode and Penumbra
Given the investment horizon of 90 days InMode is expected to generate 8.1 times less return on investment than Penumbra. In addition to that, InMode is 1.12 times more volatile than Penumbra. It trades about 0.01 of its total potential returns per unit of risk. Penumbra is currently generating about 0.09 per unit of volatility. If you would invest 17,843 in Penumbra on July 26, 2024 and sell it today you would earn a total of 2,812 from holding Penumbra or generate 15.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
InMode vs. Penumbra
Performance |
Timeline |
InMode |
Penumbra |
InMode and Penumbra Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with InMode and Penumbra
The main advantage of trading using opposite InMode and Penumbra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InMode position performs unexpectedly, Penumbra 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 Penumbra will offset losses from the drop in Penumbra's long position.InMode vs. TransMedics Group | InMode vs. Inspire Medical Systems | InMode vs. Inari Medical | InMode vs. Insulet |
Penumbra vs. Insulet | Penumbra vs. TransMedics Group | Penumbra vs. Masimo | Penumbra vs. Inspire Medical Systems |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |