Correlation Between ViewRay and Rewalk Robotics

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

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

Diversification Opportunities for ViewRay and Rewalk Robotics

-0.31

Correlation Coefficient

ViewRay  Rewalk Robotics

Very good diversification

The 3 months correlation between ViewRay and Rewalk is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding ViewRay and Rewalk Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rewalk Robotics and ViewRay 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 ViewRay are associated (or correlated) with Rewalk Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rewalk Robotics has no effect on the direction of ViewRay i.e., ViewRay and Rewalk Robotics go up and down completely randomly.

Pair Corralation between ViewRay and Rewalk Robotics

Given the investment horizon of 90 days ViewRay is expected to under-perform the Rewalk Robotics. In addition to that, ViewRay is 3.38 times more volatile than Rewalk Robotics. It trades about -0.24 of its total potential returns per unit of risk. Rewalk Robotics is currently generating about 0.11 per unit of volatility. If you would invest  58.00  in Rewalk Robotics on January 24, 2024 and sell it today you would earn a total of  47.00  from holding Rewalk Robotics or generate 81.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	42.95%
Values	Daily Returns

ViewRay  vs.  Rewalk Robotics

ViewRay

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ViewRay has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, ViewRay is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Rewalk Robotics

Risk-Adjusted Performance

0 of 100

Excellent

Over the last 90 days Rewalk Robotics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite abnormal essential indicators, Rewalk Robotics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ViewRay and Rewalk Robotics

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

The idea behind ViewRay and Rewalk Robotics 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.