Correlation Between Neuronetics and SurModics

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

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

Diversification Opportunities for Neuronetics and SurModics

0.39

Correlation Coefficient

Neuronetics  SurModics

Weak diversification

The 3 months correlation between Neuronetics and SurModics is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Neuronetics and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics and Neuronetics 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 Neuronetics 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 Neuronetics i.e., Neuronetics and SurModics go up and down completely randomly.

Pair Corralation between Neuronetics and SurModics

Given the investment horizon of 90 days Neuronetics is expected to under-perform the SurModics. In addition to that, Neuronetics is 1.49 times more volatile than SurModics. It trades about -0.04 of its total potential returns per unit of risk. SurModics is currently generating about 0.18 per unit of volatility. If you would invest  2,910  in SurModics on May 21, 2025 and sell it today you would earn a total of  779.00  from holding SurModics or generate 26.77% return on investment over 90 days.

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

Neuronetics  vs.  SurModics

Neuronetics

Risk-Adjusted Performance

Weakest

Over the last 90 days Neuronetics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

SurModics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 14 (%) 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 Neuronetics and SurModics

The main advantage of trading using opposite Neuronetics and SurModics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuronetics 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 Neuronetics 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.