Correlation Between Inogen and EnVVeno Medical

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

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

Diversification Opportunities for Inogen and EnVVeno Medical

0.54

Correlation Coefficient

Inogen  EnVVeno Medical

Very weak diversification

The 3 months correlation between Inogen and EnVVeno is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and enVVeno Medical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on enVVeno Medical Corp and Inogen 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 Inogen Inc are associated (or correlated) with EnVVeno Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of enVVeno Medical Corp has no effect on the direction of Inogen i.e., Inogen and EnVVeno Medical go up and down completely randomly.

Pair Corralation between Inogen and EnVVeno Medical

Given the investment horizon of 90 days Inogen Inc is expected to under-perform the EnVVeno Medical. But the stock apears to be less risky and, when comparing its historical volatility, Inogen Inc is 1.01 times less risky than EnVVeno Medical. The stock trades about -0.09 of its potential returns per unit of risk. The enVVeno Medical Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  303.00  in enVVeno Medical Corp on December 28, 2024 and sell it today you would lose (13.00) from holding enVVeno Medical Corp or give up 4.29% of portfolio value over 90 days.

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

Inogen Inc  vs.  enVVeno Medical Corp

Inogen Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inogen Inc 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

enVVeno Medical Corp

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Inogen and EnVVeno Medical

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

The idea behind Inogen Inc and enVVeno Medical 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.