Correlation Between Electromed and Integer Holdings

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

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

Diversification Opportunities for Electromed and Integer Holdings

0.93

Correlation Coefficient

Electromed  Integer Holdings

Almost no diversification

The 3 months correlation between Electromed and Integer is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and Integer Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integer Holdings Corp and Electromed 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 Electromed are associated (or correlated) with Integer Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integer Holdings Corp has no effect on the direction of Electromed i.e., Electromed and Integer Holdings go up and down completely randomly.

Pair Corralation between Electromed and Integer Holdings

Given the investment horizon of 90 days Electromed is expected to under-perform the Integer Holdings. In addition to that, Electromed is 2.12 times more volatile than Integer Holdings Corp. It trades about -0.11 of its total potential returns per unit of risk. Integer Holdings Corp is currently generating about -0.13 per unit of volatility. If you would invest  13,358  in Integer Holdings Corp on December 30, 2024 and sell it today you would lose (1,663) from holding Integer Holdings Corp or give up 12.45% of portfolio value over 90 days.

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

Electromed  vs.  Integer Holdings Corp

Electromed

Risk-Adjusted Performance

Very Weak

Over the last 90 days Electromed 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 primary indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Integer Holdings Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Integer Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Electromed and Integer Holdings

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

The idea behind Electromed and Integer Holdings Corp 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.

Check out your portfolio center.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.