Correlation Between Sight Sciences and Iradimed

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

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

Diversification Opportunities for Sight Sciences and Iradimed

-0.72

Correlation Coefficient

Sight Sciences  Iradimed

Pay attention - limited upside

The 3 months correlation between Sight and Iradimed is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sight Sciences and Iradimed Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iradimed and Sight Sciences 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 Sight Sciences are associated (or correlated) with Iradimed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iradimed has no effect on the direction of Sight Sciences i.e., Sight Sciences and Iradimed go up and down completely randomly.

Pair Corralation between Sight Sciences and Iradimed

Given the investment horizon of 90 days Sight Sciences is expected to under-perform the Iradimed. In addition to that, Sight Sciences is 1.95 times more volatile than Iradimed Co. It trades about -0.17 of its total potential returns per unit of risk. Iradimed Co is currently generating about 0.16 per unit of volatility. If you would invest  4,435  in Iradimed Co on August 17, 2024 and sell it today you would earn a total of  971.00  from holding Iradimed Co or generate 21.89% return on investment over 90 days.

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

Sight Sciences  vs.  Iradimed Co

Sight Sciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sight Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Iradimed

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Iradimed Co are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile primary indicators, Iradimed exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sight Sciences and Iradimed

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

The idea behind Sight Sciences and Iradimed Co 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.