Correlation Between Aquagold International and Tenon Medical

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

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

Diversification Opportunities for Aquagold International and Tenon Medical

0.39

Correlation Coefficient

Aquagold International  Tenon Medical

Weak diversification

The 3 months correlation between Aquagold and Tenon is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Tenon Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tenon Medical and Aquagold International 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 Aquagold International are associated (or correlated) with Tenon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tenon Medical has no effect on the direction of Aquagold International i.e., Aquagold International and Tenon Medical go up and down completely randomly.

Pair Corralation between Aquagold International and Tenon Medical

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Tenon Medical. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aquagold International is 1.02 times less risky than Tenon Medical. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Tenon Medical is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest  174.00  in Tenon Medical on December 21, 2024 and sell it today you would lose (74.00) from holding Tenon Medical or give up 42.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Aquagold International  vs.  Tenon Medical

Aquagold International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aquagold International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Tenon Medical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tenon 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 very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Aquagold International and Tenon Medical

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

The idea behind Aquagold International and Tenon Medical 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..