Correlation Between Femasys and SurModics

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

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

Diversification Opportunities for Femasys and SurModics

-0.58

Correlation Coefficient

Femasys  SurModics

Excellent diversification

The 3 months correlation between Femasys and SurModics is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Femasys and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics and Femasys 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 Femasys are associated (or correlated) with SurModics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SurModics has no effect on the direction of Femasys i.e., Femasys and SurModics go up and down completely randomly.

Pair Corralation between Femasys and SurModics

Given the investment horizon of 90 days Femasys is expected to generate 5.89 times more return on investment than SurModics. However, Femasys is 5.89 times more volatile than SurModics. It trades about 0.03 of its potential returns per unit of risk. SurModics is currently generating about 0.02 per unit of risk. If you would invest  109.00  in Femasys on September 2, 2024 and sell it today you would earn a total of  3.00  from holding Femasys or generate 2.75% return on investment over 90 days.

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

Femasys  vs.  SurModics

Femasys

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Femasys are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak primary indicators, Femasys may actually be approaching a critical reversion point that can send shares even higher in January 2025.

SurModics

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong fundamental indicators, SurModics is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Femasys and SurModics

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

The idea behind Femasys and SurModics 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.