Correlation Between Utah Medical and Innovative Eyewear

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

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

Diversification Opportunities for Utah Medical and Innovative Eyewear

-0.21

Correlation Coefficient

Utah Medical  Innovative Eyewear

Very good diversification

The 3 months correlation between Utah and Innovative is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Utah Medical Products and Innovative Eyewear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovative Eyewear and Utah Medical 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 Utah Medical Products are associated (or correlated) with Innovative Eyewear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovative Eyewear has no effect on the direction of Utah Medical i.e., Utah Medical and Innovative Eyewear go up and down completely randomly.

Pair Corralation between Utah Medical and Innovative Eyewear

Given the investment horizon of 90 days Utah Medical is expected to generate 6.69 times less return on investment than Innovative Eyewear. But when comparing it to its historical volatility, Utah Medical Products is 8.15 times less risky than Innovative Eyewear. It trades about 0.08 of its potential returns per unit of risk. Innovative Eyewear is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  180.00  in Innovative Eyewear on May 7, 2025 and sell it today you would earn a total of  21.00  from holding Innovative Eyewear or generate 11.67% return on investment over 90 days.

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

Utah Medical Products  vs.  Innovative Eyewear

Utah Medical Products

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Utah Medical Products are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady primary indicators, Utah Medical may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Innovative Eyewear

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Innovative Eyewear are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting fundamental indicators, Innovative Eyewear showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Utah Medical and Innovative Eyewear

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

The idea behind Utah Medical Products and Innovative Eyewear 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.