Correlation Between Acutus Medical and Sientra

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

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

Diversification Opportunities for Acutus Medical and Sientra

-0.43

Correlation Coefficient

Acutus Medical  Sientra

Very good diversification

The 3 months correlation between Acutus and Sientra is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Acutus Medical and Sientra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sientra and Acutus 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 Acutus Medical are associated (or correlated) with Sientra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sientra has no effect on the direction of Acutus Medical i.e., Acutus Medical and Sientra go up and down completely randomly.

Pair Corralation between Acutus Medical and Sientra

If you would invest  429.00  in Sientra on September 27, 2024 and sell it today you would earn a total of  0.00  from holding Sientra or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Acutus Medical  vs.  Sientra

Acutus Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acutus Medical has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Acutus Medical is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Sientra

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Acutus Medical and Sientra

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

The idea behind Acutus Medical and Sientra 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.