Correlation Between Corsair Gaming and CryoLife

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

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

Diversification Opportunities for Corsair Gaming and CryoLife

0.53

Correlation Coefficient

Corsair Gaming  CryoLife

Very weak diversification

The 3 months correlation between Corsair and CryoLife is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Corsair Gaming and CryoLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CryoLife and Corsair Gaming 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 Corsair Gaming are associated (or correlated) with CryoLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CryoLife has no effect on the direction of Corsair Gaming i.e., Corsair Gaming and CryoLife go up and down completely randomly.

Pair Corralation between Corsair Gaming and CryoLife

Assuming the 90 days horizon Corsair Gaming is expected to under-perform the CryoLife. In addition to that, Corsair Gaming is 2.63 times more volatile than CryoLife. It trades about -0.08 of its total potential returns per unit of risk. CryoLife is currently generating about -0.09 per unit of volatility. If you would invest  2,800  in CryoLife on October 6, 2024 and sell it today you would lose (85.00) from holding CryoLife or give up 3.04% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.44%
Values	Daily Returns

Corsair Gaming  vs.  CryoLife

Corsair Gaming

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Corsair Gaming are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Corsair Gaming may actually be approaching a critical reversion point that can send shares even higher in February 2025.

CryoLife

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CryoLife are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, CryoLife reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Corsair Gaming and CryoLife

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

The idea behind Corsair Gaming and CryoLife 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.