Correlation Between Amedica WT and Target

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Can any of the company-specific risk be diversified away by investing in both Amedica WT and Target 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 Amedica WT and Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amedica WT and Target, you can compare the effects of market volatilities on Amedica WT and Target 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 Amedica WT with a short position of Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amedica WT and Target.

Diversification Opportunities for Amedica WT and Target

-0.71
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Amedica and Target is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Amedica WT and Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Target and Amedica WT 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 Amedica WT are associated (or correlated) with Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Target has no effect on the direction of Amedica WT i.e., Amedica WT and Target go up and down completely randomly.

Pair Corralation between Amedica WT and Target

If you would invest  15,199  in Target on December 29, 2023 and sell it today you would earn a total of  2,268  from holding Target or generate 14.92% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy4.55%
ValuesDaily Returns

Amedica WT  vs.  Target

 Performance 
       Timeline  
Amedica WT 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Amedica WT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Amedica WT is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
Target 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Target are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical and fundamental indicators, Target unveiled solid returns over the last few months and may actually be approaching a breakup point.

Amedica WT and Target Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amedica WT and Target

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

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