Correlation Between Molina Healthcare and SurModics

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

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

Diversification Opportunities for Molina Healthcare and SurModics

-0.85

Correlation Coefficient

Molina Healthcare  SurModics

Pay attention - limited upside

The 3 months correlation between Molina and SurModics is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Molina Healthcare and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics and Molina Healthcare 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 Molina Healthcare 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 Molina Healthcare i.e., Molina Healthcare and SurModics go up and down completely randomly.

Pair Corralation between Molina Healthcare and SurModics

Considering the 90-day investment horizon Molina Healthcare is expected to under-perform the SurModics. In addition to that, Molina Healthcare is 1.92 times more volatile than SurModics. It trades about -0.25 of its total potential returns per unit of risk. SurModics is currently generating about 0.22 per unit of volatility. If you would invest  2,697  in SurModics on May 4, 2025 and sell it today you would earn a total of  906.00  from holding SurModics or generate 33.59% return on investment over 90 days.

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

Molina Healthcare  vs.  SurModics

Molina Healthcare

Risk-Adjusted Performance

Very Weak

Over the last 90 days Molina Healthcare has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

SurModics

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady fundamental indicators, SurModics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Molina Healthcare and SurModics

The main advantage of trading using opposite Molina Healthcare and SurModics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molina Healthcare 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 Molina Healthcare 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.