Correlation Between K2M Group and Accuray Incorporated

Can any of the company-specific risk be diversified away by investing in both K2M Group and Accuray Incorporated 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 K2M Group and Accuray Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between K2M Group Holdings and Accuray Incorporated, you can compare the effects of market volatilities on K2M Group and Accuray Incorporated 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 K2M Group with a short position of Accuray Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of K2M Group and Accuray Incorporated.

Diversification Opportunities for K2M Group and Accuray Incorporated

0.0

Correlation Coefficient

K2M Group  Accuray Incorporated

Pay attention - limited upside

The 3 months correlation between K2M and Accuray is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding K2M Group Holdings and Accuray Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accuray Incorporated and K2M Group 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 K2M Group Holdings are associated (or correlated) with Accuray Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accuray Incorporated has no effect on the direction of K2M Group i.e., K2M Group and Accuray Incorporated go up and down completely randomly.

Pair Corralation between K2M Group and Accuray Incorporated

If you would invest (100.00) in K2M Group Holdings on January 28, 2024 and sell it today you would earn a total of  100.00  from holding K2M Group Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

K2M Group Holdings  vs.  Accuray Incorporated

K2M Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days K2M Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, K2M Group is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Accuray Incorporated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Accuray Incorporated has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with K2M Group and Accuray Incorporated

The main advantage of trading using opposite K2M Group and Accuray Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K2M Group position performs unexpectedly, Accuray Incorporated 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 Accuray Incorporated will offset losses from the drop in Accuray Incorporated's long position.

The idea behind K2M Group Holdings and Accuray Incorporated 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.