Correlation Between G Medical and Assure Holdings

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

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

Diversification Opportunities for G Medical and Assure Holdings

0.74

Correlation Coefficient

G Medical  Assure Holdings

Poor diversification

The 3 months correlation between GMVD and Assure is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding G Medical Innovations and Assure Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assure Holdings Corp and G 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 G Medical Innovations are associated (or correlated) with Assure Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assure Holdings Corp has no effect on the direction of G Medical i.e., G Medical and Assure Holdings go up and down completely randomly.

Pair Corralation between G Medical and Assure Holdings

Given the investment horizon of 90 days G Medical Innovations is expected to under-perform the Assure Holdings. In addition to that, G Medical is 1.07 times more volatile than Assure Holdings Corp. It trades about -0.07 of its total potential returns per unit of risk. Assure Holdings Corp is currently generating about -0.05 per unit of volatility. If you would invest  10,080  in Assure Holdings Corp on September 23, 2024 and sell it today you would lose (10,012) from holding Assure Holdings Corp or give up 99.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	35.53%
Values	Daily Returns

G Medical Innovations  vs.  Assure Holdings Corp

G Medical Innovations

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days G Medical Innovations has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, G Medical is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Assure Holdings Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with G Medical and Assure Holdings

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

The idea behind G Medical Innovations and Assure 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.

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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.