Correlation Between Apyx Medical and Inspire Medical

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

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

Diversification Opportunities for Apyx Medical and Inspire Medical

-0.44

Correlation Coefficient

Apyx Medical  Inspire Medical

Very good diversification

The 3 months correlation between Apyx and Inspire is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Apyx Medical and Inspire Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspire Medical Systems and Apyx 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 Apyx Medical are associated (or correlated) with Inspire Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspire Medical Systems has no effect on the direction of Apyx Medical i.e., Apyx Medical and Inspire Medical go up and down completely randomly.

Pair Corralation between Apyx Medical and Inspire Medical

Given the investment horizon of 90 days Apyx Medical is expected to generate 0.77 times more return on investment than Inspire Medical. However, Apyx Medical is 1.29 times less risky than Inspire Medical. It trades about 0.1 of its potential returns per unit of risk. Inspire Medical Systems is currently generating about -0.21 per unit of risk. If you would invest  145.00  in Apyx Medical on February 26, 2024 and sell it today you would earn a total of  15.00  from holding Apyx Medical or generate 10.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Apyx Medical  vs.  Inspire Medical Systems

Apyx Medical

Risk-Adjusted Performance

0 of 100

Very Weak

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

Inspire Medical Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inspire Medical Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Inspire Medical is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Apyx Medical and Inspire Medical

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

The idea behind Apyx Medical and Inspire Medical Systems 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.