Correlation Between SurModics and Artivion

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

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

Diversification Opportunities for SurModics and Artivion

0.41

Correlation Coefficient

SurModics  Artivion

Very weak diversification

The 3 months correlation between SurModics and Artivion is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and Artivion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artivion and SurModics 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 SurModics are associated (or correlated) with Artivion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artivion has no effect on the direction of SurModics i.e., SurModics and Artivion go up and down completely randomly.

Pair Corralation between SurModics and Artivion

Given the investment horizon of 90 days SurModics is expected to under-perform the Artivion. But the stock apears to be less risky and, when comparing its historical volatility, SurModics is 2.67 times less risky than Artivion. The stock trades about -0.22 of its potential returns per unit of risk. The Artivion is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  2,545  in Artivion on June 29, 2024 and sell it today you would earn a total of  31.00  from holding Artivion or generate 1.22% return on investment over 90 days.

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

SurModics  vs.  Artivion

SurModics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SurModics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Artivion

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Artivion are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Artivion is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SurModics and Artivion

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

The idea behind SurModics and Artivion 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.