Correlation Between Icecure Medical and Brainsway

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

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

Diversification Opportunities for Icecure Medical and Brainsway

0.25

Correlation Coefficient

Icecure Medical  Brainsway

Modest diversification

The 3 months correlation between Icecure and Brainsway is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Icecure Medical and Brainsway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brainsway and Icecure 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 Icecure Medical are associated (or correlated) with Brainsway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brainsway has no effect on the direction of Icecure Medical i.e., Icecure Medical and Brainsway go up and down completely randomly.

Pair Corralation between Icecure Medical and Brainsway

Given the investment horizon of 90 days Icecure Medical is expected to generate 1.57 times more return on investment than Brainsway. However, Icecure Medical is 1.57 times more volatile than Brainsway. It trades about 0.1 of its potential returns per unit of risk. Brainsway is currently generating about 0.15 per unit of risk. If you would invest  64.00  in Icecure Medical on September 2, 2024 and sell it today you would earn a total of  19.00  from holding Icecure Medical or generate 29.69% return on investment over 90 days.

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

Icecure Medical  vs.  Brainsway

Icecure Medical

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Icecure Medical are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile fundamental indicators, Icecure Medical displayed solid returns over the last few months and may actually be approaching a breakup point.

Brainsway

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Brainsway are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Brainsway showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Icecure Medical and Brainsway

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

The idea behind Icecure Medical and Brainsway 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.