Correlation Between Icad and GeneDx Holdings

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

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

Diversification Opportunities for Icad and GeneDx Holdings

0.44

Correlation Coefficient

Icad  GeneDx Holdings

Very weak diversification

The 3 months correlation between Icad and GeneDx is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding icad inc and GeneDx Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GeneDx Holdings Corp and Icad 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 icad inc are associated (or correlated) with GeneDx Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GeneDx Holdings Corp has no effect on the direction of Icad i.e., Icad and GeneDx Holdings go up and down completely randomly.

Pair Corralation between Icad and GeneDx Holdings

Given the investment horizon of 90 days icad inc is expected to generate 1.45 times more return on investment than GeneDx Holdings. However, Icad is 1.45 times more volatile than GeneDx Holdings Corp. It trades about 0.15 of its potential returns per unit of risk. GeneDx Holdings Corp is currently generating about -0.04 per unit of risk. If you would invest  158.00  in icad inc on September 26, 2024 and sell it today you would earn a total of  20.00  from holding icad inc or generate 12.66% return on investment over 90 days.

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

icad inc  vs.  GeneDx Holdings Corp

icad inc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in icad inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Icad exhibited solid returns over the last few months and may actually be approaching a breakup point.

GeneDx Holdings Corp

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GeneDx Holdings Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent technical and fundamental indicators, GeneDx Holdings unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Icad and GeneDx Holdings

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

The idea behind icad inc and GeneDx 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.