Correlation Between Telesis Bio and Profound Medical

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

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

Diversification Opportunities for Telesis Bio and Profound Medical

0.15

Correlation Coefficient

Telesis Bio  Profound Medical

Average diversification

The 3 months correlation between Telesis and Profound is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Telesis Bio and Profound Medical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profound Medical Corp and Telesis Bio 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 Telesis Bio are associated (or correlated) with Profound Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profound Medical Corp has no effect on the direction of Telesis Bio i.e., Telesis Bio and Profound Medical go up and down completely randomly.

Pair Corralation between Telesis Bio and Profound Medical

If you would invest  723.00  in Profound Medical Corp on August 24, 2024 and sell it today you would earn a total of  29.00  from holding Profound Medical Corp or generate 4.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Telesis Bio  vs.  Profound Medical Corp

Telesis Bio

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Telesis Bio has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very weak forward indicators, Telesis Bio displayed solid returns over the last few months and may actually be approaching a breakup point.

Profound Medical Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Profound Medical Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Telesis Bio and Profound Medical

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

The idea behind Telesis Bio and Profound Medical Corp 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.